TOKYO, Jan. 12 (Xinhua) -- Japan's Minister of Land, Infrastructure, Transport and Tourism, Seiji Maehara, met with Japan Airline Corporation's major creditor banks on Tuesday to seek approval for a court-led rehabilitation plan for Asia's largest carrier, that will involve the filing for bankruptcy protection.
The government is expected to issue a statement later today to confirm its stance on the matter and to allay public concerns about the carrier's operating potential, an issue JAL's president and CEO, Haruka Nishimatsu, who has vocally opposed the idea of bankruptcy, believes will negatively impact customer sentiment towards Japan's oldest and largest carrier, sources said.
JAL's biggest lender, the Development Bank of Japan, has already approved bankruptcy measures as being the most prudent step forward for the cash-strapped carrier and Tuesday's meeting saw the government implore commercial creditor banks, Mitsubishi UFJ and Sumitomo Mitsui Banking Corp., to continue their financial support for the carrier, ahead of the state-backed Enterprise Turnaround Initiative Corp. of Japan pursuing a court-led restructuring process.
JAL's bankruptcy would mark one of the biggest liquidations of a Japanese firm in history.
Meanwhile Prime Minister Yukio Hatoyama on Tuesday also called for JAL's retirees understanding of the carrier's predicament and to assume some of the responsibility.
"I understand that they are worried about their livelihoods if the pensions, which I assume they have long expected to receive once they got old, are cut back significantly," Hatoyama told reporters in front of his official residence Tuesday morning.
"But if we talk about who is responsible for the current bleak situation of JAL, I believe all of them should take responsibility," he said.
JAL's employees have enjoyed lavish retirement packages over the years, which for many current and former employees was the lure of the company.
JAL must receive a two-third majority approval from its 9,000 retirees to accept pension and benefit cuts of more than 30 percent by Tuesday, but many retirees are opposed to the cuts and are being urged by a minority to accept the burden as part of their ongoing their loyalty to the company.
The state-backed Enterprise Turnaround Initiative Corp. of Japan plans to dissolve JAL's corporate pension fund if the airline fails to implement the cuts, which would potentially leave the pensioners in a more detrimental situation.
The retirees will vote on the matter later on Tuesday.
JAL shares untraded due to massive sell orders, bankruptcy looks likely
TOKYO, Jan. 12 (Xinhua) -- Shares of Japan Airlines (JAL) were ask-only on Tuesday morning in Tokyo as fears mount that the state-backed fund in charge of restructuring Asia's largest carrier may lean towards delisting the company, following its expected filing for bankruptcy protection.
Investors dumped stock in the stricken carrier as rumors spread that The Enterprise Turnaround Initiative Corp. of Japan (ETIC), the state-backed body charged with restructuring the ailing carrier, may hold shareholders accountable for the carrier's downturn, along with creditors who may be asked to write-off some of JAL's 16 billion U.S. dollars in debt, should the carrier file for protection, sources with knowledge of the matter said. Full story
Nikkei hits 15-month high on weaker yen, JAL dives
TOKYO, Jan. 8 (Xinhua) -- Japan's 225-issue Nikkei Stock Average hit a 15-month closing high Friday, buoyed by exporter and tech-related issues rising with a robust U.S. dollar in early trade.
Japan's key benchmark Nikkei gained 116.66 points, or 1.09 percent, from Thursday's directionless trading, to close at 10,798.32, ahead of a 3-day weekend in Japan, which left circumspect investors with little choice but to lock in profits ahead of key U.S. employment data due out on Friday. Full story
JAL may be bankrupt within weeks
TOKYO, Jan. 8 (Xinhua) -- Japan Airlines (JAL) may be declared bankrupt as early as Jan. 19 under a government plan to maximize transparency while restructuring the struggling company, according to local media on Friday.
The government plan to seek bankruptcy for JAL will likely be opposed by private creditors, who are likely to want any restructuring plan to take place behind closed doors and away from public scrutiny. Full story
Special Report: Global Financial Crisis
