TOKYO (AP) — Shares in money-losing Japan Airlines Corp. were untraded Tuesday due to a glut of sell orders amid fears the airline will soon file for bankruptcy.
Asia’s biggest airline, known as JAL, could seek bankruptcy protection as early as Jan. 19, weekend media reports said. Following the bankruptcy filing, JAL’s shares are likely to be delisted, the major daily Asahi said Monday.
Since the market opened Tuesday, JAL was flooded with sell orders, with its price indicating at 37 yen, down a staggering 44.8 percent from Friday’s close of 67 yen. Japan’s financial markets were closed Monday due to a public holiday.
A spokesman at the Tokyo Stock Exchange said a 30-yen fall from Friday’s finish was the maximum decline allowed.
“Investors dumped JAL shares following weekend reports that the airline could file for bankruptcy as early as next week. Also reports that JAL could be delisted sparked selling,” said Kazuhiro Takahashi, equity strategist at Daiwa Securities SMBC Co. Ltd.
The Nikkei 225 stock average slipped 12.23 points, or 0.1 percent, to 10,786.09 in the morning session.
JAL will also slash about 15,600 jobs — 33 percent of its group work force — under a restructuring plan being hammered out by a state-backed corporate turnaround body, Kyodo News agency said.
The state-backed Enterprise Turnaround Initiative Corp. of Japan, which is responsible for JAL’s restructuring, will ask banks to forgive 350 billion yen ($3.8 billion) of debt owed by the airline, the Nikkei said during the weekend.
The turnaround body will decline cash offers from Delta Air Lines Inc. and Fort Worth, Texas-based American Airlines as it fears giving foreign carriers a stake in JAL would complicate the restructuring, according to media reports