Malaysia Airlines survival in doubt, says CEO.

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Malaysia Airlines will have to shut down if its lessors decide not to back its latest restructuring plan, the airline’s group chief executive was quoted as saying on Saturday.

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A group of leasing companies has rejected a restructuring plan put forward by Malaysia Airlines, bringing the state carrier closer to a showdown over its future.

Lessors claiming to represent 70% of the airplanes and engines leased to the airline group have called the plan “inappropriate and fatally flawed” and pledged to challenge it, according to people familiar with the matter and a letter from a London law firm seen by Reuters.

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However, some leasing companies have endorsed the plan, one of the people said, declining to be named due to the sensitivity of the matter.

In an email to Reuters, Malaysia Aviation Group (MAG), the airline’s parent company, said on Saturday it was “pleased” with the level of support it had received from its lessors and was continuing discussions with them.

“(MAG) is confident that there are appropriate legal mechanisms available should that support not be universal. MAG reiterates that the spirit of its restructuring plan is not intended to create unnecessary pain among its creditors but is done in good faith to drive for the long-term survivability of MAG and its dependent value chain of partners,” it said.