JAL considering 300 billion yen in subordinated loans: report

FILE PHOTO: A staff member of Japan Airlines wearing a protective face mask and gloves cleans the cabin of a plane which performed a domestic flight, amid the coronavirus disease (COVID-19) outbreak at Haneda airport in Tokyo, Japan May 26, 2020. REUTERS/Kim Kyung-Hoon

TOKYO (Reuters) - Japan Airlines Co 9201.T is considering raising as much as 300 billion yen ($2.9 billion) in subordinated loans and plans to start talks with a group of banks on the financing, Kyodo News reported on Monday.

JAL is expected to report around an 85 billion yen loss from its main business for the three months through September as demand for international flights is not expected to rebound due to the impact of the coronavirus outbreak, the report said.

A JAL spokeswoman, declining to comment on the report by Kyodo, said the airline has enough liquidity in hand.

Global airlines, facing record losses as the coronavirus pandemic discourages travel, are seeking to secure their finances through measures such as debt and government aid.

Rival ANA Holdings Inc 9202.T expects a net loss of around 500 billion yen ($4.8 billion) for the year to March, and is eyeing cuts to both jobs and its aircraft fleet, a source with direct knowledge said last week.

Japanese private equity fund Advantage Partners is looking to invest in domestic airline Star Flyer Inc 9206.T, whose largest shareholder is ANA, Kyodo News reported on Monday.

Star Flyer is planning a third-party allocation of new shares to raise about 10 billion yen ($95 million) and Advantage Partners is looking to take part, on condition that existing shareholders also participate, Kyodo said, citing sources.

Neither Star Flyer officials nor officials at Advantage Partners were immediately available for comment.

ANA owns an 18% stake in Star Flyer. Other investors include toilet maker Toto 5332.T, Yaskawa Electric Corp 6506.T and Nissan Motor Co 7201.T.

Reporting by Ritsuko Ando and Junko Fujita; Editing by Jason Neely and Jan Harvey