JAL to issue 150 bn yen in shares

Japan Airlines Corp (JAL) will call for a capital infusion of 100-150 billion yen in the form of preferred shares from major creditors and business partners in order to accelerate turnaround efforts, the Nikkei reported on Friday without citing sources. JAL is expected turn to trading houses Mitsubishi Corp and Mitsui & Co, as well as its four main lenders - the Development Bank of Japan, Mizuho Corporate Bank, Bank of Tokyo-Mitsubishi UFJ and Sumitomo Mitsui Banking Corp, the business daily said.

The company aims to reach agreements on its capital enhancement measure by the end of March 2008, the report said.

JAL also plans to expedite the sale of assets, aiming to raise a total of about 250-300 billion yen, it said.

The carrier is considering spinning off its air cargo business and selling nearly 50 percent stake of the spun-off company.

JAL’s air cargo business booked sales of about 220 billion yen in the year to March 2007, leading the industry, but recorded an operating loss of around 10 billion yen, the Nikkei said.