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Japan Airlines Corp. (9205.TO) President and Chief Executive Haruka Nishimatsu said Thursday that the company has asked the Japanese government for public funds to boost its capital base, as the ailing carrier faces pressure from lenders and the government to turn around its operations.

The comments came after Nishimatsu met with Transport Minister Seiji Maehara to discuss plans to revive the struggling company, but Nishimatsu said he did not specify to the minister the amount needed by the company.

JAL is mired deep in the red as the global economic slump and an outbreak of swine flu take their toll on its bottom line, with the airline predicting a net loss of Y63 billion for the fiscal year ending March.

Earlier Thursday, media reports said that the company, known as JAL, is considering a request for public funds under Japan's Industrial Revitalization Law as part of its turnaround strategy. JAL decided to ask for public funds "taking (a possible cut in) future loan repays into consideration," Nishimatsu told reporters after the meeting.

Nishimatsu said that Maehara listened to his request "in a calm manner" without giving an immediate response. In June, JAL received a combined loan totaling Y100 billion from state-backed Development Bank of Japan and other banks.

Nishimatsu also said that a possible split of the company into two groups "would not make business sense" in the airline industry. He said that such a scheme would only work for manufacturers, but did not elaborate further.

According to a person familiar with the matter, JAL would consider a breakup of the company along with a range of other restructuring options. One possibility involves JAL splitting off its more profitable parts and selling its money-losing operations, the person familiar with the matter said, but Nishimatsu said that such a step would not help the company to recover.

In an effort to get approval for the injection of public funds, Nishimatsu said that JAL is seeking to make more cuts, mainly through a reduction in labor costs. Still, he declined to say whether the company aims to step up the number of job cuts from a currently planned 6,800, or 14% of JAL's overall workforce, by the end of 2011.

He added that there is no change in its plans to scrap 50 international and domestic routes.

Delta Air Lines Inc. and American Airlines parent AMR Corp. have been in separate talks with JAL in recent weeks to build stronger ties and potentially invest in the loss-making airline, according to people familiar with the matter.

AMR, British Airways PLC and other members of the Oneworld airline alliance are also in talks with JAL to discuss deeper cooperation, a BA spokeswoman said last Friday.

The Japanese airline is currently a member of Oneworld, while Delta belongs to the rival SkyTeam group.

-By Yoshio Takahashi and Tomoyuki Tachikawa, Dow Jones Newswires; 813-6895-7561; yoshio.takahashi@dowjones.com