KDB injecting around US$ 722 mil. to help Korean Air buy cash-strapped Asiana Airlines
Arirang News
2020-11-16
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대한항공•아시아나 통합 국적항공사 출범…산은 8천억 투입
South Korea's biggest air carrier, Korean Air, is moving ahead with plans to acquire Asiana Airlines, it's main local rival for 1-point-6 billion U.S. dollars following an injection via its parent, Hanjin Kal.
Korean Air expects a spot in the world's top 10 airlines once the deal is complete.
Eum Ji-young reports.
South Korea's flagship airline Korean Air is pushing ahead with its bid to acquire its biggest local rival, Asiana Airlines.
At a ministerial meeting on Monday, government officials gave their approval for Hanjin Group, the owner of Korean Air, to take over cash-strapped Asiana,… the nation's second-largest carrier.
The CEO and the chairman of the state-run Korea Development Bank said the deal is largely aimed at helping the local airlines survive amid intensified competition in the global aviation industry and the damage caused by the coronavirus pandemic.
"Under the deal to combine Korean Air and Asiana Airlines to raise their competitiveness, the state-run Korea Development Bank would invest around 722 million U.S. dollars."
Should the deal happen, it would give Korean Air a more than 60 percent stake in Asiana Airlines, which would make it the largest shareholder.
Korea Development Bank's chairman also said amount of government funds injected to normalize the local airlines would be minimized through the acquisition and added that it would create synergies.
"This deal will create a competitive national carrier that will be one of the top 10 in the world."
The International Air Transport Association ranked Korean Air as the world's 18th largest carrier in terms of production last year, and ranked Asiana 32nd.
However, challenges lie ahead as the country's antitrust watchdog still has to give the deal its approval.
And private equity fund KCGI,... a major shareholder in Korean Air's holding company, Hanjin KAL, is opposing the deal.
Also, as the acquisition would lead to the streamlining of the two businesses, labor groups are also likely to voice their opposition.
Eum Ji-young, Arirang News.
South Korea's biggest air carrier, Korean Air, is moving ahead with plans to acquire Asiana Airlines, it's main local rival for 1-point-6 billion U.S. dollars following an injection via its parent, Hanjin Kal.
Korean Air expects a spot in the world's top 10 airlines once the deal is complete.
Eum Ji-young reports.
South Korea's flagship airline Korean Air is pushing ahead with its bid to acquire its biggest local rival, Asiana Airlines.
At a ministerial meeting on Monday, government officials gave their approval for Hanjin Group, the owner of Korean Air, to take over cash-strapped Asiana,… the nation's second-largest carrier.
The CEO and the chairman of the state-run Korea Development Bank said the deal is largely aimed at helping the local airlines survive amid intensified competition in the global aviation industry and the damage caused by the coronavirus pandemic.
"Under the deal to combine Korean Air and Asiana Airlines to raise their competitiveness, the state-run Korea Development Bank would invest around 722 million U.S. dollars."
Should the deal happen, it would give Korean Air a more than 60 percent stake in Asiana Airlines, which would make it the largest shareholder.
Korea Development Bank's chairman also said amount of government funds injected to normalize the local airlines would be minimized through the acquisition and added that it would create synergies.
"This deal will create a competitive national carrier that will be one of the top 10 in the world."
The International Air Transport Association ranked Korean Air as the world's 18th largest carrier in terms of production last year, and ranked Asiana 32nd.
However, challenges lie ahead as the country's antitrust watchdog still has to give the deal its approval.
And private equity fund KCGI,... a major shareholder in Korean Air's holding company, Hanjin KAL, is opposing the deal.
Also, as the acquisition would lead to the streamlining of the two businesses, labor groups are also likely to voice their opposition.
Eum Ji-young, Arirang News.
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