JAL slump raises bankruptcy option

The company is seeking its fourth state bailout since 2001and shares fell when Kyodo News said the carrier may drop a plan to sell a stake in JALways Co.

According to Reuters the airline, struggling with high costs in the global downturn, has asked creditors for 600 billion yen ($6.6 billion) in aid, including 300 billion yen in debt waivers and debt-for-equity swaps, as part of a restructuring plan.

JAL shares fell to 100 yen, their lowest since they were re-listed in 2002. By the close, the stock was quoted at 101 yen, down more than 11 percent. The shares have lost a quarter of their value this week.

JAL had forecast a 90 billion yen ($990 million) profit from the sale of stakes in the resort-focused JALways airline and other units, according to Kyodo.

The airline is working with a government-appointed task force on a new plan to put to the transport ministry within two weeks. Transport Minister Seiji Maehara has pledged his support for the airline while that process is underway but drastic measures may have to be taken when the time comes.