By Chris Cooper and Kiyotaka Matsuda Nov. 10 (Bloomberg) — Japan Airlines Corp. ’s application for financing from a state-affiliated fund won’t be decided upon before next year, the lender’s president said, prolonging the carrier’s bid to avoid collapse. “Due diligence won’t be quick,” Hiroshige Nishizawa , president of Enterprise Turnaround Initiative Corp. of Japan, said in an interview in Tokyo yesterday. “We’re not going to be able to make a decision on whether to provide aid by the end of this year.” The group will also draw up a new plan for the carrier, instead of relying on one completed by a government-appointed taskforce last month, Nishizawa said. JAL is seeking state support as it heads for its fourth loss in five years on plunging international travel. The due-diligence team will be decided upon “soon,” said Nishizawa, a former head of Tokyo Tomin Bank Ltd. Enterprise Turnaround was set up last month by the government and private companies with 1.6 trillion yen ($18 billion) to help restructure companies and buy assets. JAL fell 2.8 percent to 106 yen in Tokyo trading yesterday. The stock has slumped 50 percent this year, the biggest decliner in the Nikkei 225 Stock Average. The government created a taskforce to develop a plan for JAL after the transport minister said President Haruka Nishimatsu’s proposal to cut 6,800 jobs and slash routes didn’t go far enough. The carrier , predicting a loss of 63 billion yen this fiscal year, is due to announce first-half earnings on Nov. 13. To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net ; Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net
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Japan Air’s Fourth State Bailout to Be Decided in 2010 After Panel Review
