The national carrier Vietnam Airlines hopes its co-operation with the All Nippon Airway will provide better services to passengers. — Photo VNA

The purchase will be made under a memorandum of understanding (MoU) on partnership co-operation signed between the two sides. The ANA will buy VNA shares worth more than VND2.43 trillion (US$108 million).

The partnership will mark ANA's first investment in a foreign national carrier, as well as the first time VNA receives funds from a foreign company.

The co-operation is expected to help the two carriers exploit the advantages on either side to expand their network and international market and to share services in the Vietnamese and Japanese markets.

ANA, with its five-star service quality, is seen as a top airline in the world. As a strategic shareholder of the VNA, the ANA will support and transfer its management experiences to Vietnam Airlines, a VNA press release issued on January 12 said.

General Director of ANA Shinya Katanozaka said Asia was a key market of the ANA in its strategy to expand operations and that the VNA was an ideal partner as the two sides had similar high development standards, methods to access customers and effective operations.

He said he expected to finalise the strategic investment soon and would co-operate with the VNA in their efforts to provide better services.

Chairman of Vietnam Airlines Pham Viet Thanh said the VNA highly valued the ANA's long-term investment decision to become a VNA strategic partner.

"The co-operation with the ANA will help Vietnam Airlines to access new management technology, expand the market and improve service quality and competitiveness in the international market," Thanh said.

The ANA will send its representative to take part in the VNA's executive board.

Vietnam Airlines has been operating 66 weekly flights on 10 routes between Japan and Viet Nam, while, the ANA has been running 14 flights per week between the two countries.

Following the signing of the MoU, the VNA will ask the transport ministry and the Prime Minister to approve its negotiations with the ANA. If they are approved, the two sides hope to sign a share-purchase contract in the first quarter of this year.

Superior performance in 2015

The carrier is set to transport 19.2 million passengers in 2016, an increase of 10.6 per cent against 2015. It is also expected to post revenues of VND77.8 trillion ($3.55 billion) and pre-tax profits of more than VND2.3 trillion ($105 million).

The figures were released at a review conference held recently in Ha Noi. The carrier operated more than 127,500 flights in 2015, representing a year-on-year increase of 3.5 per cent.

Speaking at the conference, Minister of Transport Dinh La Thang praised the carrier for its positive performance in 2015, and said the VNA's superior year-end results significantly contributed to the transport sector's achievements last year.

Even though it faced numerous challenges due to fluctuating foreign exchange rates and poor domestic airport infrastructure, the VNA fulfilled its key objectives and created breakthroughs in revamping its fleet and improving its quality of service.

The VNA also made progress in restructuring and equitisation and worked hard to seek strategic investors after becoming a joint stock company on April 1, 2015. It divested VND819 billion ($37.4 million) from its non-core businesses during the 2012-15 period. — VNS