Tony Fernandes

This article is about the Malaysian entrepreneur. For the former baseball player, see Tony Fernández.
Tony Fernandes

Fernandes at an Air Asia event
Born Anthony Francis Fernandes
(1964-04-30) 30 April 1964
Kuala Lumpur, Malaysia
Residence Kuala Lumpur, Malaysia[1]
Education Epsom College and Alice Smith School
Alma mater London School of Economics
Occupation Group Chief Executive Officer
Director of AirAsia Berhad and founder of Tune Group Sdn Bhd
Chairman of Queens Park Rangers
Net worth Decrease US$530 million (2015)[2]

Tan Sri Anthony Francis "Tony" Fernandes, CBE (born 30 April 1964) is a Malaysian entrepreneur. He is the founder of Tune Air Sdn. Bhd., who introduced the first budget no-frills airline, AirAsia, to Malaysians with the tagline "Now everyone can fly". Fernandes managed to turn AirAsia, a failing government-linked commercial airline, into a highly successful budget airline public-listed company. He has since founded the Tune Group of companies.

He was also instrumental in lobbying the then-Malaysian Prime Minister, Tun Dr. Mahathir Mohamad in mid-2003, to propose the idea of open skies agreements with neighbouring Thailand, Indonesia, and Singapore. As a result, these nations have granted landing rights to AirAsia and other discount carriers.

As of February 2014, Forbes Asia valued Fernandes' net worth at $650 million, ranking him at number 28 on the Forbes list of Malaysia's Richest.

Early life and education

Fernandes was born in Kuala Lumpur on 30 April 1964 to an Indian father (originally from Goa[3]) and a mother of mixed Indian (Malayali[4]) and Asian-Portuguese (Kristang) descent who had been raised in Malacca, Malaysia.[5][6][7] At a young age, he would follow his mother who sold Tupperware at Tupperware parties.[8]

He was educated at The Alice Smith School in Kuala Lumpur. Starting at age 12, from 1977 to 1983, he studied at Epsom College boarding school in England.[9] He matriculated to the London School of Economics and graduated with a degree in accounting.[10]

Career

He worked very briefly with Virgin Atlantic as an auditor, subsequently becoming the financial controller for Richard Branson's Virgin Records in London from 1987 to 1989.[11]

Fernandes was admitted as Associate Member of the Association of Chartered Certified Accountants (ACCA) in 1991 and became Fellow Member in 1996. He is currently a member of the Institute of Chartered Accountants in England and Wales (ICAEW).

Fernandes was formerly a Warner Music executive in Malaysia.[12] He was the South East Asian regional vice-president for Warner Music Group from 1992 to 2001.

When Time Warner Inc announced its merger with America Online Inc., Fernandes left to pursue his dream of starting a budget no-frills airline.

In September 2001, Fernandes purchased AirAsia and became its chief executive.[13][14]

AirAsia

It was through Datuk Pahamin A. Rejab, the former secretary-general of the Malaysian Domestic Trade and Consumer Affairs Ministry that Fernandes came to meet with then Prime Minister, Tun Dr. Mahathir Mohamad in October 2001.

Instead of starting from scratch, Mahathir advised Fernandes to buy an existing airline.[15] AirAsia, the heavily indebted subsidiary of the Malaysian government-owned conglomerate, DRB-Hicom, was losing money. Fernandes mortgaged his home and used his personal savings to acquire the company, comprising two Boeing 737-300 jet aircraft and debts of US$11 million (RM40 million), for one ringgit (about 26 US cents), and transformed it into an industry player.[16] One year after his takeover, AirAsia had broken even and cleared all its debts.[15] Its initial public offering (IPO) in November 2004 was oversubscribed by 130 per cent.[15]

Fernandes says his timing was in fact perfect: after 11 September 2001, aircraft leasing costs fell 40%. Also, airline lay-offs meant experienced staff were readily available. He believed Malaysian travellers would embrace a cut-rate air service that would save them time and money, especially in a tight economy. Fernandes estimates about 50 per cent of the travellers on Asia’s budget airlines are first-time flyers. Before the advent of AirAsia, he estimated that only six per cent of Malaysians had ever travelled by air.[17]

Fernandes' biggest achievement was to open up countries within the region to new budget carriers, which previously did not have open-skies agreements.[16] As a result of Fernandes' lobbying in mid-2003, Dr Mahathir brought up the idea with leaders from neighbouring countries. Those nations subsequently granted landing rights to AirAsia and other discount carriers.[16]

In Thailand and Indonesia, AirAsia holds a minority stake in the respective local companies. Thai AirAsia, a joint venture with Shin Corporation, Thailand’s largest telecommunication conglomerate, took to the skies in Feb 2004 and has to date carried over 1 million passengers in its first year of operations. PT Awair, re-launched as a low fare airline on 8 December 2004 and subsequently renamed Indonesia AirAsia, presently serves 5 domestic destinations in Indonesia.

Other ventures

In 2007, Fernandes started a hotel chain, Tune Hotels, based on the no frills concept. It has properties in Britain, Australia and the Far East.[18]

As of 2013, Fernandes is also involved in a reality TV series: The Apprentice Asia is an Asian reality game show in which a group of aspiring young businessmen and women compete for the chance to work with Fernandes, who also serves as the host of the show.[19]

In March 2012, Tony Fernandes served on the International Advisory Board of Global March to Jerusalem, which aims to "mobilize the international community in solidarity with Palestinians and to protect Jerusalem."[20] A Joint Statement was issued, signed by the various members of the Board, including Fernandes.[21]

Caterham Group

Fernandes is the founder of the Caterham F1 Formula One team, which began racing in 2010 as Lotus Racing and raced in 2011 as Team Lotus. On 2 July 2014, Caterham F1 was sold to a Swiss and Middle Eastern consortium.[22]

On 16 December 2009, Fernandes accepted a "challenge" from Richard Branson, a fellow airline boss and the owner of Lotus' fellow F1 newcomers Virgin Racing. The losing team's boss would work on the winner's airline for a day dressed as a stewardess. Fernandes joked "The sexier the better. Our passengers will be delighted to be served by a Knight of the Realm, but knowing Richard, the real challenge will be to prevent him from asking our guests 'coffee, tea or me?' That would be scary."[23] In addition, the team produced a poster depicting Branson in an Air Asia uniform. However, the date of the flight was delayed several times: first because of Branson breaking his leg, then because of the royal wedding, finally because of a fire at the Necker Island. On 19 December 2012, Fernandes announced that Branson would honour his bet in May 2013. Branson ultimately honoured the bet on 13 May 2013.[24]

Caterham Racing, also created by Fernandes, competes in the GP2 Series.

On 27 April 2011, Fernandes announced that his company had purchased Caterham Cars.

EQ8 is a natural energy drink and the first FMCG product from Fernandes and his business partner Kamarudin Meranun. EQ8 is also the Official Drink of Caterham F1.

Football

Fernandes is a fan of English club West Ham United and was involved in talks regarding a potential takeover of the club back in May 2011, at which stage it looked as if he was going to acquire a 51 per cent stake in the club. Former West Ham chairman Andrew Bernhardt even flew to Kuala Lumpur to try and finalise the deal, but the two parties failed to agree on the price.[25] It was just one month later when Fernandes made another offer to buy 51 per cent of the club, although co-owners David Sullivan and David Gold rejected his bid. Sullivan told the London Evening Standard: "He wanted 51% of the club for two bob." Sullivan's comments started a war of words on Twitter. "It was a good offer with good money and brought in good people," said Fernandes. "Gold and Sullivan can say whatever they want. I have been a lifelong fan and would have brought good money, good ideas, new people and a new belief. As for PR stunts. Wow. They are always in the press making huge claims. Were we not supposed to be in Europe. Now we have been relegated. Two sacked managers. All good players will be sold. No new training ground which is the most important ingredient I feel. Look at how many injuries we have. And more investment into the academy."[26]

Tony Fernandes' seat at Loftus Road

On 18 August 2011, just three months after Queens Park Rangers' promotion back to the Premier League following a 15-year absence, Fernandes was unveiled as their majority shareholder, having bought Bernie Ecclestone's 66% stake. He was also named as chairman of QPR Holdings Ltd.[27]

Everyone knows I've followed West Ham all my life but I've always had a soft spot for QPR. Rangers were one of the first teams I watched as a child at Loftus Road. I've always wanted to be involved in football and the appeal of a London club, like QPR, was too good an opportunity to turn down.

“
”

Tony Fernandes, August 2011.[27]

While Neil Warnock remained as the club's manager for their return to the top-flight, a run of eight Premier League games without a win eventually led to his sacking.[28] Mark Hughes was quickly named as his replacement, signing a two-and-a-half-year deal in the process.[29] Despite their new manager, QPR's poor run of form continued, which left them fighting for Premier League survival on the final day of the 2011-2012 season. Relegation rivals Bolton Wanderers needed a win to have any chance of survival, but could only muster a draw with Stoke City,[30] meaning QPR were safe, despite losing 3-2 to Manchester City after Sergio Agüero's injury-time winner - a goal which stole the Premier League title from arch-rivals Manchester United on goal difference.[31]

Mark Hughes led the club into the 2012-2013 season, but after just four points from 12 games and without a single win - one of the worst starts in Premier League history - Fernandes gave Hughes his marching orders.[32][33] Fernandes hired former Tottenham Hotspur manager Harry Redknapp on 24 November 2012,[34][35] but even he was unable to solve QPR's problems. Following a goalless draw with relegation rivals Reading on 28 April 2013, both teams were relegated to the Championship.[36]

Tony Fernandes watching QPR v Newcastle alongside Les Ferdinand at Loftus Road May 2015

Speaking to the media just one week after Rangers' relegation back to the Championship, Fernandes said he had been exploited since he took over at Loftus Road. After investing an estimated £50 million into the club, he said: "I don't think I will be exploited any more. I think I allowed myself to be exploited but that's my choice. Agents are trying to get the best contracts and there are no two ways about it, I had to pay premiums. I've seen all of the parts that make football quite - maybe immoral is a strong word - but they would sell their grandmother to do something. It's all part of the football ecosystem."[37]

Honours and awards

Honours

Fernandes has been awarded the following honours:

Awards

Fernandes has received several awards for his achievements:

References

  1. ↑ Sharanjit Leyl (28 December 2014). "Tony Fernandes: The man behind AirAsia's revival". BBC News. Retrieved 28 December 2014. In 2007, I interviewed Mr Fernandes again, this time in his home in a posh Kuala Lumpur neighbourhood. The interview focused on expansion plans, but what I was struck by was how ordinary and middle class his home seemed. His children were in the background watching TV.
  2. ↑ "#21 Anthony Fernandes". Forbes. February 2013.
  3. ↑ "'My father was an Indian citizen, a doctor. He was from Goa'".
  4. ↑ "'My mother was a Fernandez as well, with a 'z', and her ancestors were Malyalee'".
  5. ↑ Brian Mertens (3 December 2010). "Flying On A Budget". Forbes. Retrieved 28 December 2014. Raised in Malacca of mixed Portuguese-Asian descent, his mother was an entrepreneurial-minded music teacher who launched the Tupperware direct-marketing business in Malaysia.
  6. ↑ "We were Malaysians first". The Nutgraph. 19 November 2009.
  7. ↑ "Flying On A Budget". Forbes. 20 December 2010.
  8. ↑ Brian Mertens (3 December 2010). "Flying On A Budget". Forbes. Retrieved 28 December 2014. At the age of six, he began his career playing the piano for guests at the sales parties hosted by his mother. Raised in Malacca of mixed Portuguese-Asian descent, his mother was an entrepreneurial-minded music teacher who launched the Tupperware direct-marketing business in Malaysia.
  9. ↑ Brian Mertens (3 December 2010). "Flying On A Budget". Forbes. Retrieved 28 December 2014. Funded by his mother’s Tupperware sales, Fernandes flew to England at the age of 12 for boarding school at Surrey’s Epsom College, where he spent more time on sports than study.
  10. ↑ "Cheap, but not nasty". The Economist. 19 March 2009. Retrieved 28 December 2014.
  11. ↑ AirAsia 2006 Corporate Annual Report
  12. ↑ Elahe Izadi (28 December 2014). "The man behind AirAsia: Flamboyant chief executive Tony Fernandes". The Washington Post. Retrieved 28 December 2014.
  13. ↑ Sharanjit Leyl (28 December 2014). "Tony Fernandes: The man behind AirAsia's revival". BBC News. Retrieved 28 December 2014. AirAsia's brand image is closely tied with its chief executive, Malaysian entrepreneur Tony Fernandes, who took over operations in 2001. Almost always in jeans and an Air Asia cap when interviewed, Mr Fernandes was seen as Malaysia's answer to Richard Branson.
  14. ↑ "How Air Asia founder Tony Fernandes' dream came true". BBC News. 1 November 2010. Retrieved 28 December 2014. Mr Fernandes bought Air Asia from a Malaysian government-owned company in September 2001 for a mere 25 pence.
  15. 1 2 3 "Battle-hardened Fernandes". Business Times (Malaysia). Yahoo! News. 3 December 2014. Retrieved 29 December 2014.
  16. 1 2 3 "Tony Fernandes". Bloomberg Businessweek. 11 July 2004. Retrieved 29 December 2014.
  17. ↑ Stevens, Andrew (24 October 2007). "Interview with Tony Fernandes". Retrieved 29 December 2014.
  18. ↑ "The Richest People in Travel". The Telegraph. Retrieved 12 February 2014.
  19. ↑ Wells, Jennifer S. (27 February 2013). "Tony Fernandes Is Trump's Asian Apprentice". Forbes Asia (4 March 2013). Retrieved 29 December 2014.
  20. ↑ http://gm2j.com/main/concept-and-objectives/
  21. ↑ http://gm2j.com/main/wp-content/uploads/2012/03/GMJ-IAB-press-release.pdf
  22. ↑ Andrew Benson. "BBC Sport - F1: Caterham face legal action from more than 40 former staff". BBC Sport.
  23. ↑ "Lotus boss accepts Branson's bet | Lotus | Formula 1 news, live F1 | ESPN F1". En.espnf1.com. 16 December 2009. Retrieved 29 April 2010.
  24. ↑ "Lady in Red". Virgin. 16 December 2009. Retrieved 25 May 2013.
  25. ↑ Jason Burt (20 November 2009). "West Ham showing signs they are on road to recovery after troubled past". The Telegraph. Retrieved 18 July 2013.
  26. ↑ "Tony Fernandes hits back at West Ham owner Sullivan". BBC Sport. 3 June 2011. Retrieved 2 June 2011.
  27. 1 2 "Lotus boss Tony Fernandes completes QPR takeover". BBC News. 18 August 2011. Retrieved 18 August 2011.
  28. ↑ "Neil Warnock sacked as manager of Queens Park Rangers". BBC Sport. 8 January 2012. Retrieved 29 July 2013.
  29. ↑ "Mark Hughes confirmed as new Queens Park Rangers manager". BBC Sport. 10 January 2012. Retrieved 29 July 2013.
  30. ↑ "Stoke 2-2 Bolton". BBC Sport. 13 May 2012. Retrieved 30 July 2013.
  31. ↑ "Manchester City 3-2 QPR". BBC Sport. 13 May 2012. Retrieved 30 July 2013.
  32. ↑ "Mark Hughes sacked as Queens Park Rangers manager". BBC Sport. 23 November 2012. Retrieved 30 July 2013.
  33. ↑ "Mark Hughes: QPR's patience finally runs out with manager". BBC Sport. 23 November 2012. Retrieved 30 July 2013.
  34. ↑ "QPR: Harry Redknapp takes over as manager". BBC Sport. 24 November 2012. Retrieved 30 July 2013.
  35. ↑ "Harry Redknapp returns to rescue Queens Park Rangers". BBC Sport. 24 November 2012. Retrieved 30 July 2013.
  36. ↑ "Reading 0-0 QPR". BBC Sport. 28 April 2013. Retrieved 30 July 2013.
  37. ↑ "QPR's Tony Fernandes: I have been exploited". BBC Sport. 4 May 2013. Retrieved 31 July 2013.
  38. ↑ "Tony Fernandes Legion D'Honneur". F1ezine.com. 15 April 2010. Retrieved 29 April 2010.
  39. ↑ "Tony Fernandes receives CBE". Racing-Report.com. 6 February 2011. Retrieved 6 February 2011.
  40. ↑ Mertens, Brian (20 December 2010). "Flying On A Budget". Forbes.
  41. ↑ "The 100 Most Creative People in Business 2011". Fast Company. Retrieved 8 June 2013.
  42. ↑ "Asian Brands Honoured at the 2014 World Branding Awards". Yahoo Finance. 29 October 2014. Retrieved 16 February 2015.
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