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  • November 2013 (Revised January 2015)
  • Case
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Restructuring JAL

By: Malcolm Baker, Adi Sunderam, Nobuo Sato and Akiko Kanno
  • Format:Print
  • | Language:English
  • | Pages:22
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Abstract

Hideo Seto, the recently appointed chairman of the investment committee of the Enterprise Turnaround Initiative Corporation, must decide whether to push JAL group, Japan's largest airline, into bankruptcy or to act as a sponsor in an out-of-court restructuring. The bankruptcy of JAL would be the largest ever for an industrial firm in Japan's history. The case introduces the mechanics of bankruptcy, the tradeoff between out-of-court restructuring and bankruptcy, and the costs of financial distress. At the level of public policy, the case also serves as a useful backdrop to discuss the role of bankruptcy in the efficient functioning of the economy, and the related comparison between Japan and the U.S. in terms of both the bankruptcy code and the cultural attitudes toward corporate restructuring. This case can fit into an introductory course in a module on capital structure and the tradeoff between the costs and benefits of debt or in an advanced corporate restructuring course in a module on the effect of different legal and cultural environments on bankruptcy proceedings.

Keywords

Bankruptcy; Costs Of Financial Distress; Cost vs Benefits; Air Transportation; Restructuring; Capital Structure; Insolvency and Bankruptcy; Air Transportation Industry; Japan; United States

Citation

Baker, Malcolm, Adi Sunderam, Nobuo Sato, and Akiko Kanno. "Restructuring JAL." Harvard Business School Case 214-055, November 2013. (Revised January 2015.)
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About The Authors

Malcolm P. Baker

Finance
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Adi Sunderam

Finance
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Related Work

    • January 2015
    • Faculty Research

    Restructuring JAL

    By: Malcolm Baker and Adi Sunderam
    • November 2013 (Revised January 2015)
    • Faculty Research

    Restructuring JAL

    By: Malcolm Baker, Adi Sunderam, Nobuo Sato and Akiko Kanno
Related Work
  • Restructuring JAL By: Malcolm Baker and Adi Sunderam
  • Restructuring JAL By: Malcolm Baker, Adi Sunderam, Nobuo Sato and Akiko Kanno
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