The company said the news reported over the weekend by The Edge Weekly about ongoing talks was factually incorrect.
The weekly reported that the airline has approached businessman Ishak Ismail whose family owns Raya Airways, to acquire the carrier, and are in early conversations.
"After consulting with Raya's shareholders and Board of Directors, we would like to clarify that Raya and its subsidiaries/affiliate companies are not in any talks with AirAsia Group Berhad or any other parties for the acquisition of the Company or any part of its businesses," it said.
The carrier said its operational and financial position is strengthening and it is committed to the next stage of growth.
(Reporting by Liz Lee; Editing by Emelia Sithole-Matarise)