Vietnam Airlines (VN, Hanoi) will issue VND8 trillion dong (USD345 million) worth of common shares to existing shareholders “to supplement the capital” of the flag carrier in a plan to return it to profitability within two years.

The issuance will be completed by June 2021, as soon as approval is received from the State Securities Commission of Vietnam, the company announced in a disclosure following a meeting of shareholders on December 29. The proceeds will pay off outstanding debts and will be used for day-to-day operations.

“We have suffered the worst crisis in history because of the restrictions of governments around the world to curb the spread of the coronavirus,” chairman Đặng Ngọc Hòa said at the meeting.

The issuance of new shares is part of a VND12 trillion (USD518 million) rescue plan for cash-strapped Vietnam Airlines, a plan which the National Assembly of Vietnam unanimously approved in November. The package also involves VND4 trillion (USD173 million) in soft loans. With it, the carrier has set a target to start making a profit from 2023.

The plan foresees the State Capital Investment Corporation (SCIC), a state-owned holding company that is also considered to be a national wealth fund, buying 85% of the new shares on behalf of the government.

Exactly how many shares the SCIC will buy was not revealed at the shareholders’ meeting, but the corporation said earlier that it could invest up to VND6.8 trillion (USD294 million) to buy new shares from the carrier.

The 86.19% government-owned airline now anticipates a full-year loss of VND14.445 trillion (USD623.5 million), less than the VND15.1 trillion (USD652 million) it warned of four months previously. Its second-largest shareholder is Japan’s ANA Holdings with 8.77%.