Big changes are in store at Fly Asian Xpress (FAX). Datuk Kalimullah Hassan and Lim Kian Onn have emerged as shareholders in the low-cost, long-haul carrier with each holding a 10% stake, says an industry source. When contacted, Kalimullah, who is chairman of FAX, confirmed his entry into the company.

More intriguingly, sources say that a key investor will soon emerge with a 20% interest in FAX. It is largely speculated that he is Sir Richard Branson (pic) , the founder of the Virgin Group.

As it stands, 60% of FAX is owned by Datuk Tony Fernandes, AirAsia Bhd deputy chief executive Kamarudin Meranun and other parties. AirAsia owns a 20% stake (with an option to purchase another 10%) and Kalimullah and Lim will have 10% each.

Sources say, Fernandes and Kamarudin will sell their 20% stake to Branson. The potential entry of Branson has been long anticipated. When FAX’s long-haul budget airline AirAsiaX was first mooted, there was much speculation that Fernandes was in discussions with Branson, the founder of the Virgin group.

Though AirAsia later denied the link, Fernandes himself has found it hard to dispel the association, having previously worked for Branson. “I won't hide the fact that we're talking, we're always exchanging ideas, but it's not settled,” said Fernandes of a possible collaboration with Branson in an interview with BizWeek earlier this year.

At the time, Fernandes also said that “it isn't like I can go to Stansted Airport and there is a Virgin equivalent of AirAsia so we can operate end-to-end. I'd really be getting Richard Branson, and that's it.” His stance was that AirAsia had built its brand by itself, and that its long-haul arm should be capable of a similar achievement.

However, the circumstances may have changed as the clock ticks down towards AirAsiaX's planned maiden voyage on September 8, which it will make with a leased A330 aircraft. According to Fernandes, the carrier's initial destination would be the Britain, Australia or China depending on landing rights, although he has established a preference for the former with the prime destinations of London and Manchester.

FAX, which has a paid up capital of RM120mil, recently inked a US$2.6bil deal for the purchase of 15 Airbus A330-300s, with the option to purchase an additional 10 at the Paris Air Show. The company also signed a US$1.3bil deal for Rolls-Royce to supply engines for its fleet, which it will be taking delivery of beginning September 2008.

According to sources, several private equity houses and foreign investors have also expressed interest to invest in FAX and they may come in later in the second round of financing.

“FAX needs to raise funds to finance its purchase of aircraft, so it will need to bring them in eventually. The company has been approached by 20 parties - local and foreign - but their suitability needs to be assessed,” says the source.