JAPAN Airlines’ shares jumped 31 per cent yesterday as the government looked to secure funds to prevent the carrier from running out of cash as it awaits a possible bailout.
The stock lost a quarter of its value last Wednesday, the last trading day of 2009, after sources said a government-backed turnaround fund was leaning towards a bankruptcy proceeding for JAL as part of its restructuring plan.
But the shares rebounded on news the government had asked the state-owned Development Bank of Japan to double its credit line to JAL to 200bn yen (£1.34bn). A spokesman for the DBJ said it was considering the government’s request.
The extra funding is aimed at keeping the carrier going until the state-backed fund -- the Enterprise Turnaround Initiative Corp of Japan (ETIC) -- decides later this month whether or not to support JAL with taxpayer money.