Korean Air will be among the world's ten largest air carriers

Created on 24.11.2020 10:34

Korean Air has announced that the board of directors decided to buy Asiana airline for $ 1.6 billion. The Korea Development Bank (KDB) is investing $ 722 million, and Korean Air will issue new shares to raise $ 2.2 billion dollars to support a deal in the following year. The deal is expected to close in 2021, according to the company's press service.

The privately-owned Asiana has experienced financial difficulties before the outbreak of the pandemic. Its parent company, the Kumho Group, previously reached an agreement with Hyundai Development Corp. on purchasing the controlling stake, but the deal fell through due to plummeting asset prices amid the pandemic. The indebted Asiana is effectively taken over by KDB and other creditors.

According to Korean Air's release, the main reason for this acquisition is the stabilizing and restructuring of the Korean air transport industry. According to the carrier, the movement would protect workplaces in both airlines and related industries. After the merger, Korean Air may become one of the ten largest air carriers in the world. Korean Air's fleet, including passenger and cargo aircrafts, amounts 170 aircrafts, of which more than 30 aircrafts are held in storage. Asiana's fleet consists of 75 aircrafts.

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