Short of cash, Vietnam Airlines (VN, Hanoi) proposes to inject nearly 10,000 billion VND (433 million USD) into infrastructure development at Long Thanh International Airport, currently under construction in the province. from Dong Nai, south-eastern Vietnam. It will be located 40 kilometers northeast of Ho Chi Minh City.
This is according to a proposal by the airline, submitted to the country’s ministries of Transport, Planning and Investment, and the Commission for the Management of State Capital in Enterprises (CMSC), report the local media.
Vietnam Airlines would raise some 70% of the 9.9 trillion dong (US $ 429 million) through loans and 30% from equity.
The national carrier will spend the money on the provision of aviation fuel, ground operations, catering, a cargo terminal, an aviation logistics center, airline lounges and duty-free shops.
The airline has also requested the construction of a separate terminal for Vietnam Airlines and its subsidiaries, as well as policy approvals that would accommodate future growth in the group’s capacity. The company also wants to establish an MRO facility at the airport.
Vietnam Airlines offers to invest jointly with its subsidiaries or in a joint venture with Airports Corporation of Vietnam (ACV).
Vietnam Airlines Chairman Dang Ngoc Hoa said the proposal was in line with the airline’s growth strategy for 2021 to 2030, which calls for maximum allocation of resources and participation in infrastructure projects to the Long Thanh International Airport.
Construction of Long Thanh International Airport began on January 5, 2021. It will be built in three phases until 2040 and will include four runways and four terminals with a capacity of 100 million passengers and five million tonnes of cargo. per year.
The first phase of construction is divided into four projects, the third of which is funded to the tune of 99 trillion VND (4.3 billion USD) by ACV, and includes site leveling, road links, construction of tracks, passenger and auxiliary aircraft terminals. Infrastructure.
Vietnam Airlines recorded an after-tax loss of 11,097 trillion VND ($ 478 million) for the year 2020. At the end of December 2020, its assets amounted to nearly 63 trillion VND (2.7 billion dollars). dollars), with total liabilities of 56.8 VND. trillion (2.4 billion USD) and 6.14 trillion VND (266 million USD) in equity. Last year, Reuters reported that Vietnam Airlines needed VND 12 trillion ($ 520 million).
The government approved an airline bailout, ordering the State Bank of Vietnam, the country’s central bank, to indirectly provide low-interest loans to Vietnam Airlines through institutions financial. To raise capital, the government will also buy new shares of the airline through its State Capital Investment Corporation (SCIC), which could invest up to 6.8 trillion VND ($ 295 million) to buy new actions of the airline within the framework of the support plan. .