| NEWS ARCHIVES |
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| JAL wings clipped as US$25bil debt sinks firm |
| 19 Jan 2010 |
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Japan Airlines (JAL) has filed for bankruptcy protection after owing more than 25 billion US dollars.
It has vowed to slash 15,700 jobs and cut unprofitable routes as it tries to survive volatile fuel costs and fickle flyers.
JAL, Asia's largest airline by revenues, will remain in the skies thanks to nearly 1 trillion yen or 11 billion US dollars in state-backed support.
It also faces a sweeping restructuring under a new board and management.
Shareholders will be wiped out and creditors will forgive 730 billion yen in debt, with banks waiving 350 billion yen in loans, as part of the restructuring deal.
JAL, which has now been bailed out by the Japanese government 4 times in the past 10 years, will replace many of its older and less fuel-efficient planes.
It also faces tough decisions about foreign capital and alliances.
Shares of JAL, which have fallen more than 90 percent since the start of the month, closed flat at 5 yen after trading down 2 yen to 3 yen.
They will be delisted next month. |