Shares of Japan Airlines Corp. surged Monday amid speculation that American Airlines and Delta Air Lines are vying to buy stakes in the money-losing carrier.
Under a major restructuring plan, the airline known as JAL, is looking to raise $2.8 billion from banks, investment funds and airlines including Delta, according to the Nikkei financial daily.
Japan's largest airline said media reports of tie-ups with foreign carriers are not based on official information from the company and that nothing has been decided.
JAL stock soared almost 8 percent on the Tokyo Stock Exchange, beating a sharp slump in the overall market. The Nikkei 225 stock average tumbled 2.3 percent as the dollar fell to a seven-month low against the yen.
Hit by plummeting demand amid a slumping global economy and swine flu fears, JAL incurred its biggest-ever quarterly net loss of $1 billion in the three months to June.
Delta is in preliminary discussions about buying a stake in JAL for about $300 million. The U.S. airline giant could become a leading shareholder in JAL and get coveted access to Haneda Airport, close to Tokyo's business district, according to a person briefed on the Delta situation.
The Nikkei said Delta offered to invest up to $550 million, which would give it a 11.2 percent stake in JAL.
Delta's rival American Airlines is also negotiating a possible investment, according to a person familiar with the talks. American would like
to form a joint business venture with JAL. The two carriers would seek antitrust immunity to work closely in setting schedules and prices for service around the world, said the person, who spoke on condition of anonymity because the talks are sensitive.
American and JAL already have a code-sharing agreement. Delta doesn't have a Japanese partner. A Delta-JAL hookup would raise doubts about JAL's ability to remain in oneworld, an airline alliance that includes American and British Airways. Delta is in another alliance, called SkyTeam, which also includes Air France-KLM.
