Korean Air finalizes Asiana Airlines acquisition after four-year process

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Korean Air finalizes Asiana Airlines acquisition after four-year process

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Simple Flying | Simple Flying

By Sky Industry News

Dec 12, 2024

Korean Air has completed its acquisition of Asiana Airlines, securing a 63.88% stake in the company. This acquisition, which was initiated on November 16, 2020, faced numerous regulatory hurdles over the past four years. The deal culminated with Korean Air acquiring 131,578,947 newly issued shares of Asiana Airlines on December 12, 2024.

As part of this process, an extraordinary meeting of shareholders is scheduled for January 16, 2025. At this meeting, new board directors nominated by Korean Air will be appointed to oversee Asiana's operations as a subsidiary.

The financial details include a transaction completion payment made on December 11, 2024. Korean Air paid KRW 800 billion ($558 million), bringing the total investment through capital increase to KRW 1.5 trillion ($1.05 billion). This amount includes previous payments totaling KRW 700 billion.

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Looking ahead, Korean Air plans to integrate with Asiana within two years without reducing its workforce. The integration strategy focuses on network optimization and service expansion while maintaining safety standards. According to Korean Air: "The merger aims to strengthen national aviation industry competitiveness, enhance Seoul Incheon Airport's hub capabilities and expand global reach."

Despite the completion of the acquisition, some regulatory matters remain pending. The integrated frequent flyer program will be submitted for review by June 2025 to the Korea Fair Trade Commission.

The journey towards completing this acquisition involved clearing significant regulatory approvals from various international authorities between February 2021 and November 2024.

In their announcement about the merger's completion, Korean Air stated: "The acquisition represents a strategic milestone for Korea's aviation industry. Korean Air will proceed to implement measures to strengthen the country's aviation capabilities and enhance its competitive position in the global market."