September 9, 2021
TOKYO (Reuters) -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)
(Reporting by Maki Shiraki in Tokyo and Kanishka Singh in Bengaluru; writing by Jamie Freed in Sydney; Editing by Christopher Cushing and Richard Pullin)
Source Link Japan Airlines looking to raise $2.7 billion – sources