A government-backed turnaround body and the state-owned Development Bank of Japan are planning to extend Japan Airlines Corp. A credit line totaling 600 billion yen to avert severe cash drain as they finalise a court-led rehabilitation plan for the carrier, sources close to the matter said.
The government also effectively clinched consent from JAL's key commercial creditor banks to support the airline's turnaround efforts after it files for bankruptcy protection, in a major boost after the company's shares were dumped in a massive sell-off.
Meanwhile, JAL announced it had narrowly succeeded in securing approval from over two-thirds of its retirees for drastic cuts in pension benefits, clearing a key hurdle for the cash-strapped carrier to qualify for access to public funds.
As the company's share price plummeted to an all-time low, the government emphasised it would make all-out efforts to ensure Japan's top airline would be rehabilitated without any interruption to its key operations.
"The most important thing is that all of those concerned reach a consensus and cooperate in ensuring JAL's smooth operation and its recovery in the future," Prime Minister Yukio Hatoyama told reporters.
Earlier in the day, Hatoyama also said "shareholders have a certain responsibility (for the deterioration in company conditions)" and indicated JAL's delisting may be inevitable during the restructuring process.
