Hainan Airlines unveils plan for cash from govt, parent

SHANGHAI May 26 (Reuters) - Hainan Airlines Co (600221.SS), China's fourth-largest carrier, said on Tuesday it will receive a cash injection of 3 billion yuan ($439.7 million) from the local government and its parent group, confirming an earlier state media report.

The airlines will issue a total of 595.24 million new shares to the Hainan provincial government and HNA Group at 5.04 yuan per share, it said in a statement.

It added that 2.05 billion yuan of the proceeds will be used to pay back bank loans and the remainder will be used to supplement its working capital.

The move, still pending shareholder and regulatory approval, will cut the carrier's debt ratio to 76.11 percent from 82.8 percent, it added.

Chinese airlines were hit badly last year as the global financial crisis struck home.

China Eastern Airlines (600115.SS) (0670.HK) and China Southern Airlines (600029.SS) 1055.SZ, two of the country's three biggest carriers, had received cash aid from the Chinese government to cope with a downturn in air travel demand and volatile fuel costs. ($1=6.823 YUAN) (Reporting by Fang Yan; Editing by Ken Wills) (For summit blog: blogs.reuters.com/summits/)