December 28, 2009
A state-backed turnaround body overseeing Japan Airlines’ restructuring is considering bankruptcy as one option for the cash-strapped carrier, reports said Monday.
Proposals submitted to JAL’s creditors by the Enterprise Turnaround Initiative Corp. include filing for protection from creditors to give the airline time to put its finances in order, the Nikkei business daily said.
But debt-ridden JAL, seeking its fourth government bailout since 2001, aims to avoid bankruptcy proceedings.
“We are pursuing the possibility of restructuring without bankruptcy,” JAL spokesman Kojiro Waki told AFP.
An official at the turnaround body declined to comment on the reports.
The airline has said it plans thousands of job cuts and a drastic reduction in routes as part of its efforts to return to profitability.
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JAL has been offered financial assistance by both American Airlines and Delta Air Lines, who are competing to take a minority stake in the Japanese carrier, eyeing its coveted Asian landing slots.
Japan’s government has ruled out allowing JAL to collapse, but has left the door open to possible bankruptcy proceedings to allow the group to restructure more easily.
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