Korean Air Lines Co. said Wednesday it will raise 1 trillion won ($820 million) by selling stocks as part of self-help measures amid the growing coronavirus impact on the airline sector.

The rights issue is one of the options that Korean Air has reviewed to raise the capital needed to ride out the coronavirus crisis, the company said in a statement.

Shareholders of the country's biggest carrier will be given the rights to buy 79 million stocks to be issued at 12,600 won per share. The new shares will be listed on July 29, the statement said.

Korean Air's parent, Hanjin KAL Corp., plans to hold a board meeting on Thursday to decide whether to inject 300 billion won into the national flag carrier. Hanjin owns a 29.96 percent stake in Korean Air.

Korean Air currently offers 55 flights a week on 13 international routes, sharply down from more than 900 flights on 110 long-haul routes before the airline industry was hit by the coronavirus. Starting in June, 146 flights on 32 international routes will be available.

The company has suspended more than 90 percent of flights on international routes since late March, as an increasing number of countries have closed their borders or have taken other measures related to incoming passengers.

It plans to resume flights on 19 international routes on June 1 as the country's top flag carrier strives to offset a sharp decline in passenger travel demand with an increased demand for cargo deliveries.

The reopening routes include Washington, DC, Seattle, Vancouver, Toronto, Frankfurt, Singapore, Beijing and Kuala Lumpur.

The move is aimed at preparing for increased travel demand after countries ease their entry restrictions on incoming passengers to stem the spread of the COVID-19 virus.

As part of self-rescue efforts, Korean Air had 70 percent of its 20,000-strong workforce take paid leave for six months starting April 16, and it is in the process of selling non-core assets to secure cash.

Last week, Korean Air asked Credit Suisse (CS) to provide consulting services on the reorganization of its business units in return for a planned capital injection of 1.2 trillion won from two state lenders -- the Korea Development Bank and the Export-Import Bank of Korea.

But the company denied that it has selected CS as the lead manager for the sale of certain business units to raise capital.

Korean Air has reportedly been considering selling core business units involving in-flight meals and maintenance, repair and operation (MRO), and property assets, as the creditor banks want the airline to submit its self-rescue measures within this month.

Korean Air is expected to report poor first-quarter earnings results later this week and an earnings shock is likely for this year if the coronavirus outbreak prolongs throughout the year.

For the whole of 2019, its net losses widened to 624.87 billion won from 185.65 billion won a year earlier due to a weak won and lower demand.

Its net borrowings reached 15.49 trillion won with a debt-to-equity ratio of 871 percent in 2019. This year, analysts expect the borrowings to rise to nearly 17 trillion won, with a debt ratio of 1,300 percent, due to the virus impact.

On Wednesday, Korean Air shares fell 0.6 percent to 18,200 won, its budget carrier unit Jin Air Co. declined 1.8 percent to 9,800 won and Hanjin KAL plunged 13 percent to 11,800 won ahead of the widely expected capital increase news. (Yonhap)