Mitsubishi Heavy Industries (MHI) has decided to increase the capitalisation of Mitsubishi Aircraft Corporation (Mitsubishi Aircraft), a wholly owned MHI Group company.

The decision comes as Misubishi Aircraf't's troubled MRJ90 regional jet programme struggles to recover from persistent technical problems that have left the programme years behind schedule. The MRJ suffered its first order cancellation in January.

MHI says the support package has two objectives: first, to add 170 billion yen (€1.3bn) to the company's capital, and second to cancel 50 billion yen of the total debt owed by Mitsubishi Aircraft to MHI. The added capital will bring Mitsubishi Aircraft out of its capital deficit and provide the company with funds to enable continued development of the MRJ.

According to MHI, as of 31^st March 2018, the company's liabilities exceeded assets by 110 billion yen. With the 170 billion yen to be acquired from MHI, Mitsubishi Aircraft will allocate 85 billion yen to its capital and an equal amount to its capital reserve.

Simultaneously, MHI will cancel 50 billion yen of the total debt owed to it by Mitsubishi Aircraft. The infusion of 170 billion yen will increase Mitsubishi Aircraft's paid-in capital from 100 billion yen to 270 billion yen.

The capital infusion from MHI will be allocated mainly to development of the MRJ90 and to future expenditures borne by MHI in preparation for commercialization.