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Korean Air finalizes acquisition of majority stake in Asiana Airlines

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Geoffrey Thomas Editor-In-Chief - US Bureau Chief | Airline Ratings

Korean Air has finalized its acquisition of Asiana Airlines, marking a significant development in the aviation industry. The decision, first announced on November 16, 2020, was completed with Korean Air acquiring 131,578,947 newly issued shares of Asiana Airlines. This transaction represents a 63.88% ownership stake and officially makes Asiana Airlines a subsidiary of Korean Air.

The acquisition was concluded following a payment of KRW 800 billion to Asiana Airlines on December 11. The total investment for this acquisition amounts to KRW 1.5 trillion, which includes a previously paid deposit of KRW 300 billion and an interim payment of KRW 400 billion.

As part of the transition process, Asiana Airlines will hold an extraordinary general meeting of shareholders on January 16 to appoint new board directors nominated by Korean Air.

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Korean Air has outlined plans to integrate with Asiana Airlines over the next two years. This integration strategy focuses on optimizing networks through diversified flight schedules on overlapping routes and expanding services to new destinations while enhancing safety investments. The merger aims to bolster national aviation industry competitiveness, improve Incheon Airport's hub capabilities, and expand the global network reach.

Importantly, the integration is set to proceed without workforce restructuring. Instead, natural staff growth is anticipated through business expansion, with employees in overlapping roles being reassigned within the organization.

Furthermore, an integrated frequent flyer program framework will be submitted to the Korea Fair Trade Commission by June 2025. Details about this program will be shared with customers after regulatory review.

This acquisition is seen as a strategic milestone for Korea’s aviation sector. Korean Air plans to implement measures that strengthen the country's aviation capabilities and enhance its competitive position globally.

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