Singapore approves merger between Korean Air and Asiana Airlines

Singapore approves merger between Korean Air and Asiana Airlines

by Pranali Mehta

Korean Air Lines Co., South Korea’s largest flag carrier and airline, has announced that it has won regulatory approval from Singapore to move ahead with its merger with Asiana Airlines Inc., thereby expediting acquisition of its smaller domestic competitor.

Last year, Korean Air presented documents to antitrust regulators in 14 nations for evaluation of its business acquisition with Asiana.

As of today, the firm had obtained approval for collaboration from seven nations, namely Vietnam, Singapore, Thailand, Taiwan, Turkey, Malaysia, along with the Philippines. Meanwhile, China, South Korea, the United Kingdom, Japan, Australia, the United States, and the European Union, are still waiting for approval.

Korea Fair Trade Commission will conduct a meeting to discuss the case. To avoid monopolistic worries, the antitrust regulator is largely anticipated to accept the merger of the country's two largest airlines on a requirement that the carriers relinquish part of their transportation rights and surplus airport slots.

If the deal is done, Korean Air, the world's 18th-largest air carrier by fleet, could become Asiana's majority shareholder with a 63.9% interest.

In November 2020, Korean Air agreed to buy Asiana's controlling interest in a deal worth 1.8 trillion won (US$1.5 billion), making it the world's tenth-largest airline by the fleet.

The two full-service airlines in the country control a total of 40% of cargo and passenger slots at South Korea's principal gateway, Incheon International Airport, which is below the monopoly level.

After closing an acquisition procedure next year, Korean Air stated that it plans to create a united business with Asiana in 2024, promising to streamline routes and cut the cost of maintenance.

Since March 2020, the two carriers have ceased the majority of their foreign flights as countries tighten entrance restrictions to halt the outbreak of the COVID-19 pandemic.

Source credit: http://www.koreaherald.com/view.php?ud=20220209000163&np=1&mp=1

 

Pranali Mehta

A chemical engineer by qualification, Pranali Mehta dutifully walked down the slated path and worked in a chemical firm for a year. Her passion for writing however, pushed her into experimenting with the same as a career. With over three years of experience in content writ Read more...