Japan Airlines, the biggest air carrier in Asia, is set to file for bankruptcy protection under the Corporate Rehabilitation Law as early as Jan.19, according to Japanese media reports.
The move, similar to a Chapter 11 filing in the United States, would be one of the biggest corporate failures in Japanese history. Under provision of the law, JAL shares would be removed from the Tokyo Stock Exchange. The government-backed Enterprise Turnaround Initiative Corp. would then officially announce a restructuring plan for JAL that involves pre-packaged court-backed rehabilitation, including a $3.3 billion injection from the fund, news reports said.
Major U.S. companies Delta Air Lines and American Airlines are seen as in the running to invest in the troubled Japanese airline.
In related news, JAL saw international cargo volume pick up on a year-on-year basis for the first time in 16 months in November. International air cargo gained 9.1 percent to 56,552 tons. Domestic cargo declined for the eighth consecutive month in November, falling 7.3 percent to 39,369 tons.
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