Japan Airlines looking to raise $2.7 bln - sources

JAL, which raised $1.8 billion in a share sale last November, declined to comment. The airline last month posted a first-quarter operating loss of 82.65 billion yen, an improvement from a year earlier, as pandemic-related cost cuts took effect and travel demand rose from a very low base.


Reuters | Updated: 09-09-2021 07:44 IST | Created: 09-09-2021 07:44 IST
Japan Airlines looking to raise $2.7 bln - sources

Japan Airlines Co Ltd (JAL) is looking to raise 300 billion yen ($2.72 billion) to ride out anticipated funding challenges amid a continued slump in air traffic, two sources familiar with the matter said on Thursday.

The funds will be raised through financing that includes subordinated loans, according to the sources, who confirmed an earlier Nikkei report https://s.nikkei.com/38ShGaE. JAL, which raised $1.8 billion in a share sale last November, declined to comment.

The airline last month posted a first-quarter operating loss of 82.65 billion yen, an improvement from a year earlier, as pandemic-related cost cuts took effect and travel demand rose from a very low base. JAL, like other carriers, has been burning through cash reserves to keep jets and workers it will need when travel demand rebounds.

The airline last month said it expected its cash burn rate to fall to around 5 billion yen a month in the second quarter ending Sept. 30 from 10 to 15 billion yen a month in the first quarter. Rival ANA Holdings Inc last year raised $3.8 billion in subordinated loans and $3.2 billion of equity to help it weather the pandemic and fund the purchase of new planes.

JAL shares were down 1.8% in morning trade, compared with a 0.4% decline in the broader market. ($1 = 110.1600 yen)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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