Creditors Stick to Block Deal for Sale of Asiana and Its Subsidiaries
Financial Services Commission (FSC) Chairman Choi Jong-ku said it is possible to sell Asiana Airlines Inc. to a buyer with shortcomings after making up for its weak points. However, he denied the possibility of hiving off of the airline's subsidiaries. Currently, Kumho Industrial Co. and creditors are seeking a buyer for Asiana Airlines.
“We also hope to find a buyer which is financially sound and can stably operate the airline. We can consider remedying one or two weaknesses of a potential buyer if it has several strengths,” said Choi during a luncheon meeting with reporters at a restaurant in Jongno-gu, Seoul, on July 5.
Since the airline business is a monopoly-controlled industry, a buyer needs to have a financial soundness and good external reputation as well as healthy cash flow. This is why it is difficult to find a qualified buyer for Asiana Airlines. Accordingly, Choi implied that the financial regulator would accept a buyer as much as possible even it has some shortcomings.
In regard to the recent rumor in the market about the separation of subsidiaries from Asiana Airlines, he said, “We have never considered separate sales of the subsidiaries.” The Korea Development Bank (KDB), which is the main creditor, also sticks to the principle of a block deal, but there has continuously been a rumor in the market that Asiana Airlines’ creditors would sell off Air Busan Co. separately from Asiana Airlines, its parent company.