Garuda Indonesia equity injection cut by about $400 million, company says
A worker cleans a Garuda Indonesia's aircraft parked at the Garuda Maintenance Facility (GMF) AeroAsia, at Soekarno-Hatta International airport near Jakarta, Indonesia, January 21, 2022. REUTERS/Willy Kurniawan
JAKARTA :Airline Garuda Indonesia will receive a $1.4 billion capital injection from the asset management unit of sovereign wealth fund Danantara Indonesia, the company said on Tuesday, a reduction of about $400 million from what it disclosed previously.
Last month, Indonesia's flag carrier disclosed that the Danantara unit would provide an injection of about $1.8 billion in cash and the wealth fund's loans would convert into equity.
But in a Tuesday filing, Garuda said the injection, via a private placement, would amount to around 23.67 trillion rupiah ($1.43 billion).
The injection will be used to pay for fleet maintenance and a funding increase for Garuda's low-cost carrier, Citilink.
"There is also an adjustment to the planned use of funds, which no longer includes fleet expansion," Garuda said in an earlier filing, explaining the reduction.
Danantara Indonesia did not immediately respond to a request for comment.
Garuda Indonesia's finances have been strained since the COVID-19 pandemic, forcing the airline to restructure its debt.
($1 = 16,570.0000 rupiah)
