The merger process between Korean Air and Asiana Airlines has overcome hurdles, and will a mega carrier be born by the end of next year?

Regarding the merger procedure between Korean Air, South Korea's largest airline, and Asiana Airlines, the second-largest airline, Asiana has accepted a request from the European Union (EU) to separate and sell Asiana Airlines' cargo business.
On the 2nd of this month, Korean Air submitted to the European Commission a proposal for corrective measures to alleviate concerns about competition restrictions resulting from the merger of the two companies. Korean media reported, ``The three-year merger between Korean Air and Asiana Airlines
The procedure has passed the biggest hurdle,'' (Chosun Ilbo) reported. Regarding the merger of the two companies, Asiana Airlines' debt for the fiscal year ending December 2015 was 8.4 trillion won (approx.
Management deteriorated, reaching 40 million yen). Although the company sold its headquarters building in 2018, it began to struggle with cash flow, and the Korean conglomerate Kumho Asiana Group decided to close the Asiana Group in April 2019.
announced the sale of Na Air. At the end of 2019, a consortium of Hyundai conglomerate group HDC Hyundai Industrial Development and Mirae Asset Daewoo announced that they would acquire Asiana Airlines, but the new coronavirus
Due to the spread of the coronavirus, the situation has changed significantly from when the acquisition agreement was signed, and in September 2020, HDC announced a clean sheet of plans to acquire Asiana Airlines. In response to this, Asiana Airlines' creditors
The government-affiliated Korea Industrial Bank, which is in charge of the company, has decided to sell the aircraft to Korean Air. Korean Air officially announced the acquisition of Asiana Airlines in November 2020. Korean Air and Asiana Airlines
Rather than operating as an independent company, integration can be expected to generate synergy effects, help maintain employment, improve the efficiency of overlapping routes, increase the number of new destinations, diversify flight schedules, and improve customer service.
Benefits include an increase in options, the ability to earn miles, and diversification of usage methods. After the merger is completed, the Asiana brand will be discontinued and the Korean Air brand “Korean” will be replaced.
The company aims to streamline its fleet and sales organization by unifying its operations with Air. Since January 2021, Korean Air has applied to 14 competition authorities to merge with Asiana Airlines. home country korea
It was also approved by authorities in Turkey, Taiwan, Vietnam, Singapore, Malaysia, Australia and China. Currently, the UK has been conditionally approved and Korean Air has been informed that it will be excluded from the preliminary screening process.
Examinations have been completed in 11 countries and regions, including Thailand, which has completed the procedure, and the Philippines, which has terminated the procedure because it is not subject to examination, and the remaining countries are awaiting examination in three countries: the EU, Japan, and the United States.
Ru. However, in May of this year, the European Commission, the EU's administrative enforcement agency, announced the results of an interim review of the business integration of both companies and objected to the merger. European Commission on passenger transport business
, Incheon - Frankfurt (Germany), Paris (France), Barcelona (Spain), and Rome (Italy), and the cargo business is competitive across South Korea and Europe.
He expressed the view that there are concerns about the In response to the European Commission's announcement, Korean Air said at the time, ``We will submit a written response to resolve the competition authorities' concerns stated in the interim review report.''
We will work together to discuss proactive corrective measures and do our best to obtain final approval." The EU is a mandatory reporting country for review, so if EU approval is not obtained, the
Merger will become virtually impossible regardless of the examination results of the countries in question. At the time, when the EU, which had the most stringent standards among the EU, US, and Japan that was under review, objected to the merger, Korean media reported,
``No.''. The two companies have been in discussions to address concerns. At the board meeting on the 2nd of this month, Asiana Airlines proposed corrective measures to alleviate concerns about competition restrictions resulting from the merger of the two companies.
It has been decided that Korean Air will agree to submit the matter to the European Commission. The proposed corrective measures center on selling Asiana Airlines' cargo business. Also, regarding the oligopolization of routes connecting South Korea and Europe, there are
Based on the proposed positive measures, the plan is to support the entry of domestic airlines into the four overlapping routes of Paris, Frankfurt, Rome, and Barcelona. Korean Air will soon submit a corrective action plan to the EU.
Yonhap News reported on this decision with the headline, ``Asiana Airlines to sell cargo business, gaining momentum for business integration with Korean Air.'' The Chosun Ilbo said, ``The European Commission is considering a merger between the two companies as early as January next year.
It is expected that the merger will be approved." Korean Air has announced a detailed schedule for the integration. The merger will be completed by the end of next year, with approval from the EU, US and Japanese authorities within one year.
Aim for completion. Chosun Ilbo said, ``As early as the end of next year, the two-strong Korean airline system that lasted for 35 years will end, with sales of 20 trillion won (approximately 2.26 trillion yen) and a fleet of approximately 230 passenger planes.
It is expected that a ``mega carrier'' (superlarge airline), one of the top 10 in the world in terms of passenger transport, will be launched.''