Posted on: 07 December 2018 by Mark Howells
Mitsubishi Heavy Industries (MHI) has cancelled 50 billion yen of the total debt owed to it by Mitsubishi Aircraft Corporation (MAC), as part of its ongoing efforts to continue funding the development of the delayed MRJ90 regional jet and enter it into service.
After completion of the capital increase, MAC’s capital and capital reserve each now stand at 135 billion yen. In conjunction with the capital-related measures affecting MAC, previously announced in October, MHI cancelled 50 billion yen of the total debt and said it had “taken over the company’s subscription shares in their entirety. As a result of these measures, effective today a capital increase in Mitsubishi Aircraft has been completed in the amount of 170 billion yen.”
MHI says the measures “will strengthen Mitsubishi Aircraft’s business foundation and drive development of the MRJ forward.” Earlier this year MAC said its liabilities exceeded its assets by 110 billion yen as of 31 March 2018. In October it said the added capital would bring MAC out of its capital deficit and provide it with funds to enable the continued development of the aircraft.
The regional jet, which has suffered several lengthy delays, is nearing its planned first delivery to launch customer All Nippon Airways in mid-2020. At the Farnborough Airshow in July it also successfully performed its first public flying display.
With the 170 billion yen from MHI, MAC will allocate 85 billion yen to its capital and an equal amount to its capital reserve, along with the cancelled 50 billion yen of debt owed to MHI. The infusion of 170 billion yen increases MAC’s paid-in capital from 100 billion yen to 270 billion yen, it added in October.