Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Companies / JAL’s main banks to agree to bankruptcy plan
BackBack

JAL’s main banks to agree to bankruptcy plan

JAL’s main banks to agree to bankruptcy plan

Premium

Tokyo: The main creditor banks of Japan Airlines are in the final stages of deciding to accept a plan to put the carrier through bankruptcy as part of a state-led restructuring, three sources familiar with the matter said.

A state-backed turnaround fund is considering putting about ¥300 billion ($3.2 billion) in fresh capital into JAL, provided it files for bankruptcy and creditors agree to waive debt, sources told Reuters earlier this week.

JAL’s main creditors, which include Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group, had countered with a proposal to restructure JAL without a bankruptcy filing.

But with the state-backed Enterprise Turnaround Initiative Corp of Japan (ETIC) holding firm that bankruptcy is the most transparent and orderly way to deal with JAL’s problems, the banks will almost certainly agree to the plan, sources said.

“JAL needs ¥300 billion and the ETIC is the only one that can provide it. If the ETIC is pushing for a court-led restructuring then we have to accept it. Otherwise JAL will collapse," said one of the sources, who has direct knowledge of the discussions between the banks, the government and the ETIC.

The ETIC is planning to set up a credit line of more than ¥600 billion in coordination with the state-owned Development Bank of Japan to ensure JAL has enough funds to keep operating once it files for bankruptcy, a fourth source with knowledge of that plan told Reuters.

The ETIC is eyeing some time between 19 January for JAL to file for bankruptcy and for the ETIC to officially announce its plan to support the carrier, sources have said.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Published: 09 Jan 2010, 04:21 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App