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26 February 2024

JAL, Delta reach deal over tie-up

Japan Airlines has reached an agreement on a tie-up with Delta Air Lines as the troubled Japanese carrier readies for a court-led rehabilitation, a newspaper said Saturday.

The two companies are likely officially to sign the deal, which will allow them to run code-share flights, as soon as JAL's new management endorses it, the Yomiuri Shimbun said, quoting company sources.

The agreement means Asia's biggest airline will switch from the Oneworld alliance to the SkyTeam group, to which Delta belongs.

JAL and Delta will ask US authorities for antitrust immunity by mid-February, the paper said. If the request is accepted, the two firms will be able to run combined flights over their Pacific routes in what amounts to business integration.

The report came after American Airlines and its partners lifted their proposed investment in JAL to $1.4 billion, from a previous offer of $1.1 billion in a bidding war with rival Delta for a stake in JAL.

On Friday, Japan's government said it would announce a restructuring package for JAL on January 19, when the troubled carrier is widely expected to file for bankruptcy protection.

JAL is believed to be on the verge of seeking court protection from creditors and delisting its shares from the Tokyo Stock Exchange to make it easier to restructure its debt and slash costs.

JAL, which lost about $1.5 billion in the six months to September, is seeking public aid in the face of mounting debts. JAL is reportedly set to slash more than 15,000 jobs and sell non-core assets such as hotels.


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