Garuda Indonesia (GIAA) Plans Massive Rights Issue to Fund Restructuring
PT Garuda Indonesia Tbk (GIAA) plans to conduct a third Pre-emptive Rights Offering (PMHMETD III) or rights issue as part of a series of measures to restructure and improve the company’s financial health.
This rights issue plan follows the inbreng (contribution in kind) of land owned by PT Aviasi Pariwisely Indonesia (API) to PT Garuda Maintenance Facility Aero Asia Tbk (GMFI). As a result of this land contribution, GIAA’s ownership in GMFI has experienced dilution, making API the majority shareholder of GMFI, although Garuda remains the controlling shareholder of GMFI.
According to the Financial Recovery Restructuring Plan, the API land contribution is the initial stage of Garuda Indonesia’s recovery process. Following the contribution, the GMFI shares held by API will be transferred to InJourney and subsequently to PT Danantara Asset Management (DAM) through a dividend in specie.
“The Company intends to issue up to 124,352,806,609 Series E shares with a nominal value of Rp25 per share,” as quoted from the Indonesia Stock Exchange (BEI) information disclosure on Thursday (1/9/2026).
The execution price for the third rights issue will be determined and announced later in the corporate action prospectus.
Technically, DAM, as the current major shareholder of Garuda Indonesia, holds 370,902,553,959 shares and will exercise its rights through a contribution in kind in the form of GMFI shares. At the time of the disclosure, the GMFI shares intended for this capital contribution are still held by API.
Based on the API General Meeting of Shareholders (RUPS) on 26 June 2026, shareholders approved, among other things, a non-cash dividend distribution to InJourney, as a Series B shareholder of API, in the form of GMFI shares valued at Rp5.664 trillion.
This dividend in specie will become effective once API obtains approval from InJourney for the release of all its shareholdings in GMFI and the cancellation of GMFI shares, and once InJourney obtains approval from DAM for the receipt of said shares.
Furthermore, based on the InJourney General Meeting of Shareholders on 29 June 2026, shareholders also approved a non-cash dividend distribution to DAM, as the largest Series B shareholder of InJourney, in the form of GMFI shares valued at Rp5.664 trillion.
This distribution will become effective after InJourney effectively receives the GMFI shares from API, obtains approval from DAM for the release and cancellation of GMFI shares, and DAM obtains approval from its General Meeting of Shareholders for the receipt of the shares.
Once all conditions are met and the GMFI shares have effectively transferred to DAM, these shares will be used as the object for capital contribution in kind. Meanwhile, the portion of the rights issue allocated to the public will be paid in cash.
Garuda Indonesia estimates that the proceeds from the rights issue, after deducting issuance costs, will be used to acquire GMFI shares through DAM’s non-cash capital injection. This move is expected to directly improve the company’s financial condition while supporting Garuda Indonesia’s operational activities.
The remaining proceeds from the rights issue will be used as working capital to support the company’s business activities in realising its transformation plan.
In 2026, the transformation will focus on stabilisation and the recovery of operational resilience, while from 2027 onwards, the Garuda Indonesia Group will gradually undertake structural improvements covering human resources, processes, and digital capabilities.