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Malaysia's AirAsia, Sime in talks on new airport

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KUALA LUMPUR, Dec 23 (Reuters) - Malaysian budget airline AirAsia (AIRA.KL) is in talks with plantation-to-property conglomerate Sime Darby (SIME.KL) on a 1.6 billion ringgit ($462 million) low-cost carrier terminal project, the companies said on Tuesday.

"AirAsia and Sime Darby jointly expressed an interest to the government to develop and operate a private low-cost terminal situated on Sime Darby's land in Negri Sembilan," they said in filings with the stock exchange.

"The project is in the initial planning phase and (the companies) are engaged in preliminary discussions with state and federal authorities."

Local media reported on Saturday the government has approved the construction of a new low-cost carrier terminal in the southern state of Negri Sembilan.

The new airport will be part of a city development and will have the capacity to handle 25 million passengers a year, the government said, according to the reports.

AirAsia flew about 18 million people this year using the low-cost carrier terminal in Sepang near Kuala Lumpur, which can accommodate 15 million passengers a year at maximum capacity. ($1=3.463 Malaysian ringgit)

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