UPDATE 1-JAL lenders to retain 284.9 bln yen in debt – Nikkei

Aug 20 (BestGrowthStock) – Japan Airlines Corp’s (JALFQ.PK: ) five
main bank creditors agreed to retain about 284.9 billion yen
($3.34 billion) lent to the airline, dropping their request
that a government-based turnaround body purchase them, the
Nikkei business daily reported.

The lenders, which include state-backed Development Bank of
Japan, and Mizuho Corporate Bank, will officially approve JAL’s
proposed business rehabilitation plan next week, the paper
said.

The plan, crafted by JAL and the Enterprise Turnaround
Initiative Corp of Japan (ETIC), is centered on debt waivers
totaling 520 billion yen ($6.10 billion), or 87.5 percent of
the total, the paper reported.

The ETIC will officially decide on a 350 billion yen ($4.10
billion) investment in the airline on Aug. 31 and will submit
the restructuring plan to the Tokyo District Court later that
day, the daily said.

Mizuho Corporate Bank and two other major banks asked the
ETIC in March to purchase all of their JAL loans, but with the
restructuring plan being finalized, they have decided to
maintain business ties with JAL, the Nikkei reported.

JAL and the ETIC plan to repay 319.2 billion yen in debt in
one go next March, including portions held by non-core lenders,
by asking these lenders to rollover the loans, the paper said.

But loan amounts are expected to balloon as JAL will
require more than 200 billion yen starting next fiscal year to
procure equipment, the daily reported.

Loan negotiations with lenders will pick up steam starting
September, but some of the lenders insist on monitoring
progress on the company’s turnaround efforts before agreeing to
fresh lending, the Nikkei said. ($1=85.30 Yen)
(Reporting by Soham Chatterjee in Bangalore)

UPDATE 1-JAL lenders to retain 284.9 bln yen in debt – Nikkei