Tokyo---Shares in Japanese budget airline Skymark plunged on Thursday after a report said talks about a capital injection deal with bigger rival All Nippon Airways (ANA) had collapsed.
The company's Tokyo-listed shares dropped as much as 15.38 percent in early trading before recovering some losses to close 6.92 percent lower at 363.0 yen ($3).
Investors were spooked by a report in the Asahi newspaper that said a possible agreement over ANA investing in Skymark had fallen apart, and that the money-losing carrier would try to climb out of the red on its own.
Skymark, which flies domestic routes in Japan, rejected the report.
"It is not true that we requested a capital injection (from ANA) and we don't plan to do so," a company spokeswoman said.
But she added that the firm was talking to ANA and rival Japan Airlines about code-sharing, as well as domestic and overseas funds for a possible investment deal.
"We are working to reach a deal as soon as possible," but nothing concrete had been decided, the spokeswoman said, referring to code-sharing.
The top-selling Yomiuri newspaper said ANA and JAL planned to start code-sharing with Skymark in late March. Responding to that report, the airlines said a timeline and other details had not yet been decided.
In a separate story, the leading Nikkei business daily said Skymark had reached a "broad agreement" on code-sharing with its rivals to start in the spring.
The carrier has been struggling owing to fierce competition in the airline industry and its woes deepened in July when Airbus cancelled a deal for the carrier to buy six A380 jets, apparently over payment concerns, sending its shares into freefall.
AFP
