The government will be taking over some of SriLankan Airlines' debt and cancel the four aircraft ordered from Airbus in 2014, he said.
Wickremesinghe said the airline had become a "landmine" for the economy as it has total debts of USD 3.2 billion.
Formed in 1979 as a successor to Air Ceylon and named Air Lanka, the airline was later rebranded by the then management partner Emirates as SriLankan in 1998.
The previous government of President Mahinda Rajapaksa retook the airline ending Emirates' partnership in 2007.
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