Japan Airlines
JAL stock tanks on report it may not sell assets
Japan Airlines Corp., seeking its fourth state bailout since 2001, fell to the lowest in seven years in Tokyo trading after Kyodo News said the carrier may drop a plan to sell a stake in JALways Co.
The airline declined for a fourth day, slumping as much as 11 percent to 101 yen as of 9:43 a.m. JAL had forecast a profit of 90 billion yen ($992 million) from the sale of stakes in the resort-focused carrier and other units, according to Kyodo.
JAL has plunged 40 percent in the past month after Prime Minister Yukio Hatoyama’s new government took office and rejected a turnaround plan drawn up by the carrier. The airline is now working with a state-appointed panel on a new restructuring program and seeking help from lenders.
“The future of JAL is uncertain and so investors are selling,” said Satoshi Yuzaki, a section manager at Takagi Securities in Tokyo. “It seems like it will be difficult to get the support of banks.”
JAL may hold on to JALways if it is able to win support from financial institutions, Kyodo said. Taro Namba, a JAL spokesman, declined to comment on the report.
The Tokyo-based airline predicts a loss of 63 billion yen this fiscal year as a global recession causes a slump in demand for air travel. President Haruka Nishimatsu has already said the airline will cut 6,800 jobs and have the biggest-ever reduction in its network of routes.
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