Japan Airlines Shares Plunge to New Low Amid Bankruptcy Rumours

Shares in Japan Airlines plunged to a record low today amid rumours that Asia's biggest carrier could file for bankruptcy in an attempt to turn around its failing business, the Guardian reported. The transport minister, Seiji Maehara, and other cabinet ministers were this evening holding crisis talks to discuss JAL's options ahead of an official decision on the airline's future late next month. Maehara told reporters that no decision had been made on whether JAL should be exposed to court-led bankruptcy, and promised state backing for its restructuring efforts, possibly though bridge loans. JAL shares closed down 24% at ¥67 (46p), having plunged 32% at one stage, with investors taking flight amid media reports that liquidation was now under serious consideration. "Investors were very nervous about the fate of JAL," said Masatoshi Sato, a market analyst at Mizuho Investors Securities. "With recent reports saying the airline could face bankruptcy, investors were panicking that their JAL stock ownership could be worthless." Liquidation could leave JAL shareholders, whose shares were each worth ¥213 at the start of the year, with zero. Media reports quoted an official as saying that bankruptcy is the "strongest possibility" being considered by the Enterprise Turnaround Initiative Corporation [ETIC], a government-backed body formed in October to decide the airline's fate. Read more.