After a board meeting between Asiana Airlines and Korean Air on October 31, 2023, failed to reach an agreement to merge the two carriers, there now may be light at the end of the tunnel.
On November 2, 2023, Asiana confirmed that its board has given the green light to sell its cargo segment, allowing for the planned merger to take a step forward.
The sale of Asiana’s cargo operations was required to help alleviate tensions with the European Commission (EC) over competition rules.
The EC had previously told the two South Korean carriers that a merger could “reduce competition in the provision of cargo transport services between all of Europe and South Korea”.
However, there is still the issue of “passenger transport services on four routes between South Korea and France, Germany, Italy and Spain,” according to the EC.
According to Reuters, in a statement by Korean Air the carrier said that a package of remedies had been sent to the EC including giving up operations to some European cities.
Nikkei Asia also reported that Korean Air said it will buy $220 million of convertible bonds issued by Asiana to support the smaller airline.
“While Korean Air continues its efforts to secure the approval from the European Commission, the airline will also communicate closely with the remaining regulatory bodies to finalize the approval process as quickly as possible,” Korean Air said in a statement.
As well as the European Union, Korean Air are seeking approval for the merger from the United States and Japan.
