Malaysian Government Signs Lease Agreement for 28 Helicopters to Support Multiple Agencies

(DEFENCE SECURITY ASIA) – A few days ago, the government signed an agreement with Weststar Aviation Sdn Bhd to lease 28 helicopters for use by ministries and other government agencies.

At the signing ceremony in Putrajaya, the government was represented by Chief Secretary to the Government Tan Sri Shamsul Azri Abu Bakar, while Weststar Aviation was represented by its chairman, Tan Sri Dr. Syed Azman Syed Ibrahim.

“This agreement reflects the government’s commitment to strengthening the operational capabilities of relevant agencies, particularly in executing critical tasks that require aerial logistical support.”

“The privatization approach through asset leasing is a strategic step that not only enhances procurement efficiency but also ensures more effective and optimal resource utilization,” said the Chief Secretary in a Facebook post a few days ago.

In November, Malaysian Defence Minister Datuk Seri Mohamed Khaled Nordin stated that the Malaysian Armed Forces (ATM) and other national security agencies would operate 28 helicopters through a leasing arrangement.

Speaking during the winding-up session of the 2025 Supply Bill in the Dewan Rakyat, he said the lease procurement of the helicopters involves a contract worth RM16.5 billion over a 15-year period.

However, he did not disclose the type of helicopters being leased or the companies involved in the contract.

“This asset lease procurement is the first of its kind, executed by the Public-Private Partnership Unit (UKAS) under the Prime Minister’s Department. The procurement involves a contract valued at RM16.546 billion for a 15-year lease period.”

“It involves 28 helicopters and will benefit not only the ATM but also other national security agencies,” he said.

Under the lease contract, the Royal Malaysian Navy (TLDM) will receive two helicopters, while the Royal Malaysian Air Force (TUDM) will receive the largest share with 12 helicopters.

Meanwhile, the Royal Malaysian Police (PDRM) will receive seven helicopters, the Malaysian Maritime Enforcement Agency (APMM) will receive four, the Fire and Rescue Department will receive two, and the Prime Minister’s Department will receive one helicopter.

According to Mohamed Khaled, the primary objective of the lease involving 28 helicopters is to meet the operational needs of user agencies, conduct daily aerial operations, and carry out specific missions beyond warfare.

Regarding the RM16 billion contract cost for leasing the helicopters over 15 years, he described the expenditure as “highly reasonable.”

“The government considers the cost justified as it includes helicopter supply, insurance coverage, Maintenance, Repair, and Overhaul (MRO) services, spare parts, storage, courses, training, and off-base maintenance,” he said.

The Defence Minister added that the leasing arrangement addresses key issues related to the availability and readiness of existing helicopters.

The leasing company is required to ensure a minimum helicopter availability and readiness level of 85 percent, guaranteeing flight hours based on the operational needs of each agency.

“Under this leasing concept, end-users such as the ATM and its services are not required to issue MRO contracts or procure spare parts,” he said.

“All these aspects will be handled by the leasing company, and this is a lease-to-own arrangement. After 15 years, the government will have the option to purchase all 28 helicopters for a nominal price of RM1.”

The Defence Minister explained that after 15 years, the estimated value of each helicopter would range between RM30 million and RM50 million. However, the government will be offered the opportunity to acquire them for just RM1. – DSA