Hanjin Kal to buy Asiana Airlines after getting $724 million KDB injection: Yonhap

FILE PHOTO: An Asiana Airlines Airbus A350-900 is seen at the Airbus delivery center in Colomiers near Toulouse, France, March 20, 2019. REUTERS/Regis Duvignau

SEOUL (Reuters) – Hanjin Kal 180640.KS, owner of Korean Air Lines Co Ltd 003490.KS, is likely to buy Asiana Airlines Inc 020560.KS as Asiana’s state-run creditor Korea Development Bank (KDB) plans to inject 800 billion won ($723.55 million) into Hanjin Kal, Yonhap said on Monday.

The acquisition would combine the country’s two biggest airlines, although Hanjin Kal’s largest shareholder – an activist fund – has spoken out against the idea.

KDB will inject 500 billion won into Hanjin Kal as a third-party capital increase, and buy 300 billion won worth of exchange bonds, Yonhap news agency said, citing unidentified government sources.

With KDB injecting funds into Hanjin Kal, the latter is likely to buy a 30.77% stake in Asiana Airlines owned by Kumho Industrial Co Ltd 002990.KS, Yonhap said.

Hanjin Kal plans to have a board meeting on Monday, a Korean Air spokesperson told Reuters, without elaborating.

Korea Development Bank declined comment to Reuters before a media briefing scheduled for Monday morning.

($1 = 1,105.6600 won)

Reporting by Heekyong Yang and Joyce Lee; Editing by Jacqueline Wong and Christopher Cushing

source: reuters.com