Korean Air plans to sell new shares worth $817 Million to stay afloat

Korean Air Co. Ltd. (003490.KS), South Korea’s largest airline and flag carrier, plans to sell new shares worth 1 trillion Won ($817 Million) in its biggest rights issue in 20 years. The company came up with self-rescue measures on Wednesday to overcome the liquidity crisis due to the pandemic.

Korean Air will issue $79 Million new shares at W12,600 each on July 29. It plans to increase paid-in capital by first allocating shares to existing shareholders before offering the remaining shares to the general public.

The airline decided to accept government aid worth W1.2 trillion, extended by the Korea Development Bank (KDB) and the Export-Import Bank of Korea (Exim Bank).

Korean Air is one of the latest carriers to raise funds after the global aviation industry was forced to ground almost all of its fleets.

“Korean Air will continue to carry out self-rescue measures to overcome the dismal business environment due to COVID-19,” the airline said.