Delta Airlines looking to invest in troubled Skymark airline

With its rival airlines having associations with Japanese airlines – United has an alliance with ANA, and American has an alliance with Japan Airlines – United are now looking to form an alliance with Skymark by investing in a 20% stake in the beleaguered Japanese airline. This would then give Delta access to much coveted domestic landing slots held by Skymark at Japan’s Haneda airport. Haneda is seen as the more popular of Tokyo’s two airports as it is nearer downtown Tokyo than Narita airport, and from here Delta would be able to connect with many of Skymark’s domestic routes to major Japanese cities. If the deal were to be successful Delta could attempt to create a transit hub at Haneda for passengers coming off its flights from Los Angeles.
“It would be premature for us to comment on the matter,” said a Delta spokeswoman, while last month Delta’s President Ed Bastian made it clear the airline had been approached with regard to making an investment in Skymark. As it stands, Airbus and Intrepid Aviation, the aircraft lessor, and Airbus are the biggest creditors to Skymark. The airline has run into financial difficulty after setting out on an ambitious expansion to take on the budget end of the Japanese market, which included the purchase of a number of Airbus A380s, and the subsequent cancellation of an order for six, which saw them receive a US$700m penalty from Airbus. The airline also struggled to compete with other local airlines, including Peach Aviation Ltd. and Jetstar Japan Co.
As of today there are two restructuring plans for Skymark being considered, which involves ANA investing in Skymark, and another one which has been proposed by Intrepid. However for any restructuring program to go ahead, creditor approval would be required.