The Chinese government will inject about CNY2 billion ($315 million) into China Southern Airlines (CZ) for its fleet expansion, according to an industry insider. It is expected to reduce the carrier’s debt ratio, which was 70.88% at the end of 2011.

The Guangzhou-based carrier suspended trading Tuesday as “the parent company plans to make government capital injection to the carrier,” CZ said in a statement, without revealing the exact figure.

It will be the third time CZ has received a capital injection from Beijing. It received CNY3 billion and CNY1.5 billion in 2008 and 2010, respectively (ATW Daily News, Feb. 23, 2010).

Separately, CZ announced it has entered into 12-year lease agreements with Air Lease Corp. (ALC) for 18 new aircraft, scheduled for delivery in 2013, 2014 and 2015. The aircraft comprise 12 Boeing 737-800s, four Airbus A320-200s and two A321-200s.

Earlier this year, CZ sealed a deal with Boeing for an order of six 777 freighters and 10 777-300ERs, which will be introduced between 2013 and 2016 (ATW Daily News, Feb. 29).

China Eastern Airlines and Air China have also received government capital injections of CNY9 billion and CNY2.5 billion, respectively (ATW Daily News, March 27).

Source: ATW