Garuda Indonesia to hold rights issue in first half 2014

JAKARTA (REUTERS) - Indonesian flag carrier Garuda Indonesia plans a rights issue in the first half of this year, reducing the government's stake in the airline by more than 9 per cent, the company's vice-president told Reuters on Tuesday.

"Currently Indonesian government owns 69.14 per cent stake. After the rights issue, government ownership will be reduced to around 60 per cent," said Garuda's VP Corporate Communications Pujobroto.

In October, the firm delayed its plan to raise US$200 million (S$255 million) via a rights issue due to unfavourable market conditions.

Garuda will issue new shares and has appointed Bahana Securities, Mandiri Sekuritas and Danareksa as joint underwriters.

The airline operator said in October that it planned to add up to 250 aircraft by 2025 to effectively double its fleet and meet demand in one of the world's fastest-growing aviation markets.

Garuda's shares closed down 0.62 per cent at 482 rupiah on Tuesday. The broader Jakarta stock exchange index was down 0.78 per cent.

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