Qantas Group executive and Jetstar Group CEO Gareth Evans said on Monday (June 15) the group will cease being a shareholder in the coming month.
"Subject to the necessary approvals, our intention is to cease being a shareholder in the coming months so we can focus on our other airlines," Evans said.
Jetstar Pacific is owned by two major shareholders. Vietnam Airlines hold 70 percent, and Qantas holds 30 percent.
Qantas said the group and Vietnam Airlines (VNA) had agreed to introduce changes to improve the profitability of the low-cost carrier in response to the Covid-19 crisis.
Pending government and regulatory approval, Jetstar Pacific is set to operate under its original name Pacific Airlines and feature a new logo inspired by VNA's brand colours and design.
The airline will also change its reservation system to streamline its bookings, network and customer functions with VNA.
Qantas established Jetstar Pacific in 2007 as part of its strategy to build its presence in Asia through joint-venture partnerships using the Jetstar brand. However, the airline faced fierce competition and suffered financial strains.
Evans said with a highly competitive domestic market in Vietnam and the disruption caused by the coronavirus, "the time is right to take advantage of the strength and scale of Vietnam Airlines in its home market".
Vietnam Airlines Executive Vice President and Pacific Airlines Chairman Trinh Hong Quang said the change would unlock economies of scale and help the industry to embark on a post Covid-19 recovery.
"Low-cost carriers will play a certain role in supporting the return of travel as restrictions ease, and by streamlining functions, Pacific Airlines can remain competitive, inherit many of the efficiencies of Vietnam Airlines and continue to offer the low fares our customers expect." - Xinhua/Asian News Network