British Airways is understood to have joined Qantas and American Airlines in a three-strong investment consortium bidding to drag Japan Airlines (JAL) back from the brink of financial collapse.

Sources close to JAL told The Times that the troubled Japanese carrier was now fielding “at least two serious rescue proposals” involving substantial capital injections by foreign airlines.

Other offers to buy stakes in JAL are believed to have come from Korean Airlines and Air France-KLM.

The company is expected to make its choice within the next four weeks and is seeking some Y250 billion in funding via equity and debt.

Representatives of BA and its Australian and US cohorts are believed to have visited JAL’s Tokyo headquarters earlier this week, just as the new Democratic Party of Japan (DPJ) government was being sworn-in.

The DPJ, in contrast with its predecessor, is viewed as extremely unlikely to allow a solution to JAL’s woes that involves injections of public money.

Standard & Poor's, the credit rating agency, today placed JAL on negative credit watch to reflect the company’s short-term financing issues and poor business performance.

The agency added that “the degree of support the company can expect to receive from the new Democratic Party of Japan's (DPJ) administration needs to be carefully examined.”

The BA offer is thought to involve debt guarantees, providing consulting services and restructuring advice, and more code-sharing deals.

It is not expected that BA will directly offer cash.

American is thought to be considering a cash injection of around $300m in return for a stake that could make it JAL’s largest shareholder.

Government insiders said that the prime goal was now to prevent JAL falling into bankruptcy, and that the company was now effectively obliged to consider any offers of investment.

The rehabilitation of JAL, which is bathed in red ink and has been allowed to operate with huge inefficiencies, poses a severe political challenge to the new administration of prime minister Yukio Hatoyama, who was only inaugurated two days ago.

The BA, Qantas and AA offer of assistance is a deliberate gambit to head-off a similar rescue proposal from Delta – an offer which is believed to be the most strongly favoured by the Japanese Land and Transport Ministry.

The trio of white knights led by American Airlines are all members of the same Oneworld alliance that includes JAL.

Analysts believe it is strongly in their interests not to lose JAL from the fold, given the access the former Japanese national carrier provides for Japan itself and Asia.

Delta, meanwhile, leads the rival Skyteam alliance, and is also fixated on developing stronger presence in Asia as the airline’s merger with North West nears completion.

JAL’s troubles are numerous and deep-seated – its $1 billion loss in the most recently reported quarter offered yet more evidence of how far the company has fallen.

Its privatisation in the 1980s did not free it of obligations to run dozens of unprofitable domestic routes and management, say insiders, is bureaucratic, ineffective and unable now to make the sort of tough choices that the company faces if it is ever to return to profit.

JAL faces a deadline at the end of the month to come up with a business rehabilitation blueprint, but sources involved in drawing-up those plans, including some of JAL’s larger creditors, have said that it does not yet go far enough.

Plans to cut 6,800 from its headcount over the next three years are viewed by some as inadequate.

Some parts of the plan that have already been announced, such as cutting key routes like Tokyo-Rome and Tokyo-Amsterdam, suggest that JAL is already imagining a future where it is much more closely allied with another large international carrier.

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