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March 25, 2008 |
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JAPAN AIRLINES: Sells Stake in Two Subsidiaries Japan Airlines International's board of directors has decided to sell its 100% shareholding in two of its hotel and travel services subsidiaries -- Asahikawa Resort Development Co., Ltd and Tomakomai Ryokka Kaihatsu Co., Ltd. -- whose main business activity is the management of golf and country clubs located in Japan. JAL's 100% share in Asahikaw Resort, will be sold to Asahi Corporation, while its 100% share in Tomakomai Ryokka will be sold to Sanit Co., Ltd. The JAL Group has stated that it is concentrating its resources on the core air transport business segment in order to achieve sustainable growth. The company is trying to improve asset efficiency by centralizing business resources in the air transport business whilst selling non-core assets. The sale of these two hotel and travel services subsidiaries forms part of this move. The final agreement and share transfer was completed on March 19, 2008. Both the Asahikawa Resort and Tomakomai Ryokka will be removed from the JAL Group's consolidated statement FY2007. Removing the two companies' liabilities from the financial statement will generate special income of about JPY9.0 billion, but JAL's forecast for the current financial will remain unaffected. About Japan Airlines Tokyo-based Japan Airlines International Company, Limited -- http://www.jal.com/en/ -- was created as a result of the merger of Japan Airlines and Japan Air Systems to boost domestic coverage. Japan Airlines flies to the United States, Brazil and France. * * * As reported on Feb. 9, 2007, Standard & Poor's Ratings Services affirmed its 'B+' long-term corporate credit and issue ratings on Japan Airlines Corp. (B+/Negative/--) following the company's announcement of its new medium-term management plan. S&P said the outlook on the long-term corporate credit rating is negative. As reported on Oct. 10, 2006, Moody's Investors Service affirmed its Ba3 long-term debt ratings and issuer ratings for both Japan Airlines International Co., Ltd and Japan Airlines Domestic Co., Ltd. The rating affirmation is in response to the planned restructuring of the Japan Airlines Corporation group on Oct. 1, 2006 with the completion of the merger of JAL's two operating subsidiaries, JAL International and Japan Airlines Domestic. JAL International will be the surviving company. Moody's said the rating outlook is stable. Fitch Ratings Tokyo analyst Satoru Aoyama said that the company's debt obligations and expenses for new aircraft have placed it in an unfavorable financial position. Fitch assigned a BB- rating on the company, which is three notches lower than investment grade. |
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