Cathay Pacific has reported it will get a HK$39bn (£4bn $5bn) Hong Kong government-backed bailout, as it struggles in the facial area of the coronavirus pandemic.
As aspect of the restructuring plan the firm reported it will also carry out an additional round of govt spend cuts.
Cathay’s shares have been suspended earlier these days right before the announcement.
It comes as airlines all-around the environment are battling to endure thanks to world-wide journey restrictions.
Cathay has grounded most of its flights thanks to coronavirus-related travel curbs. It has been flying only cargo and a reduce back again passenger program to main locations these types of as Beijing, Los Angeles, Singapore, Sydney, Tokyo and Vancouver.
“Cathay Pacific has explored offered alternatives and thinks that a recapitalisation is needed to make sure it has sufficient liquidity to temperature this current disaster,” the business explained in a assertion to the city’s stock trade.
The carrier has furloughed some pilots at overseas bases and minimize cabin crew roles in the US and Canada considering that the start off of the coronavirus pandemic, but has not announced main permanent job cuts.
Past thirty day period the company announced a HK$4.5bn decline at its airways Cathay and Dragon through the January to April interval and warned of a “quite bleak” outlook.
The airline also sold six Boeing 777-300ER jets and associated tools for far more than $700m (£551m) in March.
Shares in Cathay and major shareholders Swire Pacific and Air China halted buying and selling on Tuesday early morning pending an announcement.
Swire has a 45% stake in Cathay, whilst Air China owns 30%.