UPDATE 1-Japan govt to force JAL pension cuts-media

Sat Nov 7, 2009 6:08am GMT
 
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* Govt eyes mandatory cuts for JAL pension benefits - Nikkei

* Govt aims to submit bill to parliament next year - Nikkei

* JAL threatened by estimated $3.6 bln pension shortfall

* Creditors likely to extend Y100 bln bridge loan - Asahi

* JAL says not to pay winter bonuses

TOKYO, Nov 7 (Reuters) - Japan's government plans to introduce legislation early next year to forcibly cut pension payouts for Japan Airlines Corp (9205.T) retirees and make the cuts a condition for a state bailout of the troubled carrier, the Nikkei business daily said.

Ministers will negotiate details and announce plans to submit the legislation to the regular session of parliament as early as next week, the newspaper said. The next ordinary parliament session starts in January.

JAL said last week it would apply for aid from a state-backed turnaround fund, setting the stage for an injection of public funds into the airline, providing it can secure the backing of creditors and craft a viable restructuring plan. [ID:nT349661]

Cutting its pension shortfall -- estimated at 330 billion yen ($3.7 billion) as of March -- is seen as a key prerequisite for receiving public money and to stave off bankruptcy.  Continued...

 

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