PORT OF SPAIN, Trinidad (AP) – Caribbean airline BWIA will close and a new carrier will be established in its place with the Trinidadian government staying on as a major shareholder, the company said yesterday.

Trinidad’s government, which holds more than 97 per cent of BWIA’s shares, approved a capital injection for the creation of Caribbean Airlines, according to the company.

Details about the size of the investment were not released, and calls to the airline and government officials were not immediately returned.

Trinidad has repeatedly bailed out BWIA. The carrier laid off a quarter of its 2,400 workers in 2003 in an attempt to recover cost, but it has continued to struggle.

No date has been announced for BWIA’s closure, but the Trinidad-based Caribbean Airlines is scheduled to begin service in early 2007. The carrier will provide regional air transport within the Caribbean and to major international cities.

BWIA, which has been in service for 66 years, said it will offer separation packages to eligible employees and help them find other jobs.