The Tokyo-based air carrier Japan Airlines intends to boost its stake in two low-cost carriers, including Spring Airlines and Jetstar Japan. The airline reportedly plans to invest up to $76,4 million (¥10 billion) into both companies.
Having a 5% stake in Spring Airlines, Japan Airlines (JAL) reportedly considers an opportunity to increase its stake in the Chinese low-cost carrier to 51% in June 2021. Meanwhile, JAL also reportedly plans to strengthen its position in another budget airline Jetstar Japan, where it currently holds 50% of the shares.
The possible investment into both air carriers will reach up to $76,4 million (¥10 billion), the local media reported. The move is intended to help JAL meet the expected growth of the passenger demand for air traveling after the recovery.
To stay afloat amid the pandemic, in November 2020, Japan Airlines raised almost $1.7 billion (¥180 billion) through a public stock offering. The airline suffered almost $2.86 billion loss (¥300 billion) in the fiscal year which ended in March 2021, due to fall in the demand caused by a global resurgence of the COVID-19 infections.
JAL is expected to announce the details of the possible investment in the mid-term business plan in early May 2021.