JAL wins court approval for rehabilitation plan+

TOKYO, Nov. 30 Kyodo -
Japan Airlines Corp. on Tuesday received the go-ahead from the Tokyo District
Court for its rehabilitation plan featuring debt waivers, job cuts and the
closure of unprofitable domestic and international routes.
The decision came after most major banks and other creditors of the struggling
airline approved the rehabilitation plan through postal voting. JAL said it has
also reached a basic agreement with its major creditor banks regarding new
loans.
The former national flag carrier now aims to turn itself around with the
support of its bankruptcy administrator, the state-backed Enterprise Turnaround
Initiative Corp. of Japan.
''The JAL group will achieve reconstruction as soon as possible by steadily
implementing the rehabilitation plan approved by the court,'' JAL President
Masaru Onishi told a news conference.
JAL plans to complete by next March the rehabilitation procedures by repaying
all debts, while seeking to relist itself after the carrier was delisted from
stock exchanges earlier this year.
Land, Infrastructure, Transport and Tourism Minister Sumio Mabuchi said in a
statement, ''The airline needs to revive as soon as possible as a company which
contributes to users' convenience and the economy by working on reforms
sincerely from the people's point of view.''
The plan centers on a 521.5 billion yen debt waiver primarily from Mizuho
Corporate Bank, the Bank of Tokyo-Mitsubishi UFJ and Sumitomo Mitsui Banking
Corp., and a 350 billion yen investment in JAL by ETIC with the use of public
funds.
JAL will reduce its head count to 32,600 by the end of March, cutting roughly
16,000 jobs, or about 30 percent of its group workforce of 48,714 at the end of
fiscal 2009, and will terminate services on 39 domestic and 10 international
money-losing routes by the end of fiscal 2012 from fiscal 2009 ended March this
year.
Though the carrier is likely to achieve the workforce reduction target, its
restructuring efforts could face hurdles as it is planning to terminate the
employment contracts of up to 250 pilots and cabin attendants, drawing fire
from some labor unions that could go on strike or resort to legal action to
rescind the plan.
Referring to the carrier's decision to forcibly dismiss some personnel, Onishi
said he feels ''unbearable pain as a person who has supported JAL.''
''But having a workforce which matches our business size at an early stage is a
significant factor to achieve the rehabilitation plan,'' Onishi added, noting
that the airline should take into account the troubles it has caused to
creditors, customers and business partners.
To seek retraction of the dismissal, one labor union which consists of cabin
attendants has decided to go on strike on Dec. 24-25, but Hideo Seto, an ETIC
trustee, expressed a view that flights are unlikely to be canceled even if the
union takes such a step.
JAL will also merge with four subsidiaries including Japan Airlines
International Co. on Wednesday.
==Kyodo
2010-12-01 00:19:32