Korean Air has named fellow Korean carrier Air Incheon as its preferred bidder for the cargo arm of Asiana Airlines, the sale of which is a requirement of the European Commission in the approval process of Korean’s acquisition of Asiana.
Korean’s board said Air Incheon won the process due to its existing strong cargo freighter business, and healthy financial position.
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“The preferred bidder was selected through a comprehensive evaluation of all factors crucial to the growth of the air cargo industry, a key national industry, while maintaining the existing competitive environment,” a spokesperson said.
Air Incheon has taken the clear lead in the process ahead of Air Premia and Eastar Jet.
The 12-year-old business is Korea’s only all-cargo airline and would extend its network outside of Asia for the first time by taking control of Asiana’s Americas and European routes. It would also add significant capacity via larger aircraft if the deal goes ahead.
Korean Air said it plans to sign a framework agreement in July, once conditions are agreed. Any agreement will be subject to European Commission approval due to Korean and Asiana’s significant business in the European market.
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By GlobalData“We are committed to quickly finalizing the sales process through flexible negotiations, and completing the acquisition of Asiana Airlines,” the spokesperson explained.
