Garuda Indonesia Group is seeking around USD500 million from the Danantara (Daya Anagata Nusantara) sovereign wealth fund, according to Bloomberg.
The group operates Garuda Indonesia and Citilink. As previously reported in ch-aviation, the Indonesian government transferred its 64.5% stake in the company to a Danantara-controlled operational entity in March and funding talks have been underway since early May.
Late last month, Indonesia's Minister of State-Owned Enterprises Erick Thohir approved the Danantara investment because reviving the airlines was a part of President Prabowo Subianto's broader economic reform agenda. However, at the time, there was no word on the amount or the timing.
Bloomberg says a deal could be reached as soon as June or July and the funding would likely come in two tranches. Some of the money would go to Garuda's low cost subsidiary Citilink to help cover the cost of getting aircraft back into service. According to ch-aviation Commercial Aviation News, Operator & Airport Data, 29 of that airline's 59 aircraft are out of service for various reasons. At Garuda Indonesia, 23 of its 79 aircraft are on the ground.
CEO Wamildan Tsani Panjaitan, tasked by Subianto to turn the airlines around, says getting aircraft back in the air is a priority. Both airlines are losing money and running low on cash.
"We are optimistic that we can maximise efforts to improve performance and can help align Garuda's role as the nation's flag carrier," Wamildan said at the company's May 28 annual general meeting.
