Asiana Airlines Clears Path for Merger with Korean Air, Approves Cargo Unit Sale

In a pivotal move toward its proposed merger with Korean Air, Asiana Airlines has secured board approval for the divestment of its cargo subsidiary. The decision, communicated in a stock exchange briefing dated November 2, is a crucial step in the airline’s strategy to obtain antitrust consent from the European Commission (EC) for the impending merger.

The approved proposal will see the cargo unit separation, but Asiana Airlines emphasized that the divestment will only proceed once a finalized new share purchase agreement with Korean Air is in place.

The briefing stated, “Our board of directors has requested that the underwriter (Korean Air) submit a report to the European Commission in order to satisfy the prerequisites for closing the transaction related to the new share subscription agreement concluded between the underwriter and the company. We discussed whether to agree to the submitted corrective action plan and passed it as originally proposed.”

While this development represents significant progress in the merger process, Asiana Airlines highlighted that the cargo unit’s divestment is contingent on the finalization of the new share purchase agreement with Korean Air, underscoring the meticulous approach in the deal’s execution.

It’s worth noting that the proposed merger between Asiana Airlines and Korean Air is still pending regulatory consent from the United States and Japan. The approval from the European Commission is a crucial milestone, and the decision to divest the cargo unit aligns with efforts to address antitrust concerns associated with the merger.

As the merger advances, stakeholders are keenly watching for further developments, with the airlines navigating regulatory landscapes to bring the consolidation to fruition.