“Reorganization of the aeronautical industry” … Hanjin Group’s board of directors decides to take over Asiana

[뉴스토마토 김지영 기자] Hanjin Group is in full swing to take over Asiana Airlines. The plan is to overcome the crisis between the two companies by making management more efficient by merging Korea’s first and second largest airlines.

Hanjin Group announced on the 16th that the holding companies Hanjin Kal and Korean Air held their respective board meetings this morning and decided to acquire Asiana Airlines.

The total amount of funds required for Korean Air’s acquisition of Asiana Airlines is 1.8 trillion won, and it plans to raise funds for the acquisition through a paid raise of 2.5 trillion won early next year. Under the contract with the KDB Development Bank, Hanjin Kal will participate in Korean Air’s paid-in capital increase securing a total of 800 billion won, including 500 billion won with a paid-in capital increase assigned to a third party, and 300 1 billion won by issuing barter bonds. Even before the capital increase, the full amount of 800 billion won will be loaned to Korean Air immediately after the KDB investment so that Korean Air and Asiana Airlines can use the funds to overcome the Corona 19 crisis.

With this financing, Korean Air will acquire Asiana Airlines’ 300 billion won permanent convertible bonds and will cover a 300 billion won down payment for the 1.5 trillion won acquisition. In this case, Asiana Airlines will be able to secure operating funds until the end of the year, which will not only take a breather in the fund operation, but is also expected to improve its financial structure by adding additional capital to 300 billion won per permanent bond. .

According to Hanjin Group, the reason KDB decided to invest in Hanjin Kal is to maintain a stable holding company system by maintaining Hanjin Kal’s stake in Korean Air by participating in Korean Air’s paid-in capital increase.

Hanjin Kal is also seeking a paid-in capital increase through a third-party allocation method that can expand capital quickly and reliably taking into account the urgency of the matter and, taking into account the urgency of the matter, may deteriorate the structure. If the company borrows 800 billion won entirely from the bank.

Considering the current crisis in the aviation industry, to minimize the inflow of public funds, it is urgent to reorganize the aviation industry, including not only Korean Air and Asiana Airlines, but also LCC companies such as Jin Air and related companies. with aviation. The new shares to be held by KDB are ordinary shares with voting rights, and through this, KDB will monitor and check whether Hanjin Kal and Korean Air are undertaking a sincere restructuring.

The main reason Korean Air decided to take over Asiana Airlines this time is because of the rapid stabilization of the domestic aviation industry, which is on the brink of crown 19. Not only Asiana Airlines, but also Korean Air could face a dangerous situation if the Corona 19 crisis persists, and by ensuring fundamental competitiveness through the restructuring of the aviation industry, the transaction should be promoted with the judgment that it should reduce the burden on the public by minimizing the inflow of public funds additional. It is an explanation.

At first, Korean Air thought long and hard about the decision to take over Asiana Airlines, but based on the founding philosophy of the ‘transportation office’, it made the decision to preserve jobs for both airlines and related companies and contribute to the development of the Korean aviation industry.

When Korean Air completes the acquisition of Asiana Airlines, it will be evaluated to become the world’s top 10 global network airline. Most countries with a population of less than 100 million have only one network airline. Meanwhile, Korea has been very competitive with airlines from major advanced countries such as Germany, France, Hong Kong, and Singapore due to its multiple systems. Through this acquisition, Korean Air will lay the foundation to compete with global mega airlines on key indicators such as route network, aircraft and scale of supply.

First, the integration of the two companies is expected to further enhance the competitiveness of the aviation industry by streamlining en route operations and reducing costs. In addition, it plans to lead the growth of the domestic aviation industry by expanding joint ventures with global airlines and more actively attracting overseas transit demand based on the expansion of slot share (take-off capacity and aircraft landing) from the central airport of Incheon Airport.

For aviation consumers, it is expected that they will be able to use safer aviation services by increasing the range of route and schedule options, improving connecting flights and improving mileage integration, as well as enhancing security capabilities throughout the aviation industry.

Furthermore, this acquisition is expected to contribute to strengthening the competitiveness of Incheon International Airport, which aims to become the representative hub airport in Asia, as Incheon Airport’s passenger and cargo connection network is further strengthened.

An official from Hanjin Group said: “This acquisition, which was made in a situation where the global aviation industry is in crisis due to the Corona 19 crisis, will be a signal for the reorganization of the domestic aviation industry. “.

Won-tae Cho, Chairman of Hanjin Group, said: “After the integration, we will focus all our competencies with the highest priority on protecting the valuable workplace of executives and employees of both companies.” I will.”

Reporter Kim Ji-young [email protected]

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