Saturday, January 7, 2012

Japan Airlines (JAL) is planning on relisting its shares in an IPO on the Tokyo Stock Exchange. By September, JAL shareholders intend to sell between ¥500 billion and ¥1 trillion (US$6.4b – US$12.8b, €5b – €10b).

If the sale goes into high-end estimates, it will make JAL the largest airline in the world by market value. It will also be the largest IPO in Japan since the 2010 listing of Dai-Ichi Life. However, Senri Sasahara, chief executive officer of Innovative Advisor Corp, said “The amount sought may be a bit too ambitious.”

JAL entered bankruptcy protection in January 2010 and was later given a government bailout. When it was delisted from TSE, it cut one-third of its workers, and reduced the benefits of remaining employees. JAL emerged from bankruptcy in March 2011. Since then, it has posted a record ¥188.4 billion (US$2.4b, €1.9b) in profit for fiscal year 2010.

JAL faces growing competition from discount airlines, such as AirAsia Japan and Peach. In response, JAL entered into a joint venture to form a low-cost carrier with JetStar Airways.