Distressed Indonesian Airline to Tap State Fund for $1.4 Billion

PT Garuda Indonesia expects to raise as much as $1.44 billion in cash from the nation’s sovereign wealth fund to put the distressed state-owned carrier on firmer financial footing.

Garuda, which will seek shareholder approval of the plan on Nov. 12, seeks to secure the financial help from PT Danantara Asset Management, an arm of wealth fund Danantara, through a private placement, according to a stock exchange filing. It also reached a deal to convert a $405 million loan from Danantara, the airline’s majority shareholder, into additional shares, the filing said.

The planned private placement “takes into account the ...