(Adds background on capital raising, details on half-year...

(Adds background on capital raising, details on half-year results and outlook)

Aug 11 (Reuters) - Australia's Sydney Airport Holdings (SYD) said on Tuesday it would raise A$2 billion ($1.43 billion) of equity through an entitlement offer to shore up liquidity, as the COVID-19 pandemic continues to hammer demand for travel.

Three months ago, the airport operator said https://www.asx.com.au/asxpdf/20200522/pdf/44j0yzp7g667r4.pdf it did not foresee the need to raise equity, but that was before COVID-19 cases surged in the city of Melbourne, prompting border closures between states and further hurting travel and business.

"Six months into the pandemic, there remains uncertainty as to how long it will take for aviation markets to return to pre-COVID-19 levels," the company said in a statement.

Companies in Australia and New Zealand have raised over $17 billion from equity markets to survive the pandemic and calm worries among investors and creditors.

Sydney Airport said it expected its net debt position to reduce from A$9.1 billion ($6.51 billion) to A$7.1 billion as at June 30, following the entitlement offer.

It also reported a loss after tax attributable of A$51.8 million for the half year ended June 30, compared with a profit of A$199.8 million last year.

The company also said it was targeting a 35% reduction in costs for the 12 months from April 1, and further cuts in capital project expenditures in calendar year 2021.

($1 = 1.3988 Australian dollars)