Wednesday November 18, 01:28 AM
REFILE-UPDATE 1-TPG ready to invest $1.1 bln into JAL -Nikkei
TOKYO, Nov 18 (Reuters) - U.S. private equity firm TPG is prepared to invest as much as 100 billion yen ($1.1 billion) in Japan Airlines as part of a tie-up between the struggling carrier and American Airlines, the Nikkei (news) business daily reported on Wednesday.
The chief financial officer of American Airlines parent AMR Corp (NYSE: AMR - news) said last week that American could partner with TPG on an investment in Japan Airlines, aiming to keep it from defecting to a rival airline group.
AMR's CFO, Thomas Horton, did not say how much the U.S. carrier or TPG might be willing to invest.
TPG would be willing to buy up to 100 billion yen worth of common and preferred shares from JAL (Berlin: JAY.BE - news) , the Nikkei said.
A source familiar with TPG's thinking told Reuters that the private equity firm was still in the early stages of exploring a possible investment into JAL, and no decisions on the amount or other details had been made.
It was also unclear if TPG would be able to make such an investment.
Japan Airlines has a market value of about $3 billion, and under current laws the total stake by non-Japanese persons or entities in an airline is capped at one-third in terms of voting rights.
American Airlines has outlined a separate offer to JAL that includes a 30 billion yen investment, the Nikkei said.
American is keen to keep JAL as its partner in the Oneworld airline alliance and prevent it from joining hands with Delta Air Lines, which is holding separate talks with JAL on a capital investment and joining the rival Skyteam airline group.
JAL, headed for its fourth loss in five years, is seeking a state bailout from a government-backed turnaround fund, which is expected to take until January to decided whether the carrier is worthy of an injection of public funds.
(Reporting by Nathan Layne; Editing by Michael Watson)
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