Australian flag-carrier Qantas has confirmed Vietnam Airlines will take a majority stake in low-cost offshoot JetStar Pacific.

The 69.93 per cent stake is presently owned by Vietnamese State Capital Investment Corporation.

Qantas will maintain its 30 per cent stake in the business following the transaction.

“This partnership brings together the proven low cost model of Jetstar with the unique local knowledge and existing networks of national carrier Vietnam Airlines,” Qantas chief executive Alan Joyce explained.

“We are confident this partnership between a low cost carrier and a full service airline in Vietnam can replicate the success of our Qantas and Jetstar strategy in Australia, and follows our recent partnership with Japan Airlines to form Jetstar Japan.”

Jetstar Pacific will receive a capital injection of Aus$25 million following the deal.

The cash will be used for fleet renewal, with five Boeing 737s to be replaced with new Airbus A320s.

The airline hopes to have 15 A320s in its fleet within the next few years.