Indonesian transport minister Budi Karya Sumadi says Garuda Indonesia (GA, Jakarta Soekarno-Hatta) is seeking Middle East-based investors to help the airline capitalize on strong demand for Hajj flights. A planned rights offer is days away from approval, and Sumandi argues that is the perfect vehicle for suitable investors to get onboard.

The airline's administrators are seeking court approval on Friday, October 14, for the planned rights offer that could see the restructuring airline raise up to IDR12.4 trillion rupiah (USD809.3 million) if all shareholders fully exercise their options. The Indonesian government, which has a 60.54% stake in Garuda Indonesia, has committed to investing IDR7.5 trillion (USD489.5 million) into the airline via the process.

Per a Bloomberg report, Sumadi said last week that he wants airlines from the United Arab Emirates, Turkey and Saudi Arabia, "particularly those with code-sharing arrangements," to take part in the rights offer. Just three Indonesian entities control almost the entirety of Garuda's stock, but the airline has codeshare agreements with over two dozen airlines, including Etihad Airways, Emirates, Oman Air, Saudia, and Turkish Airlines.

"They need us for the hajj traffic and we need them to connect to European markets," said Sumadi in reference to the airlines that fly the 200,000 Indonesians annually who travel to Saudi Arabia for Hajj. Indonesia is the world's most populous Muslim nation.

As part of an effort to reduce costs, Garuda Indonesia is scaling back much of its international flying, but it does retain flights between Jakarta Soekarno-Hatta and Jeddah International and Madinah. Garuda competes directly with Saudia on these sectors while the big three Gulf carriers, Oman Air, and Turkish Airlines all offer flights from Jakarta via their hubs.

Meanwhile, on the back of a stringent restructuring effort, Garuda Indonesia is showing some financial signs of life. Passenger numbers are growing and costs are decreasing. The airline has just reported a net profit for 1H 2022 of USD3.76 billion. This included revenue from debt restructuring of USD2.85 billion and profit from restructuring payments of USD1.33 billion.