S Korea’s Air Busan needs traffic rights access - chamber

Busan consigned to secondary hub in Korean Air-Asiana merger

Hanjin KAL shifts Jin Air ownership to Korean Air

Hanjin KAL, the holding company of Korean Air (KE, Seoul Incheon) and its conglomerate parent Hanjin Group, has decided to sell all of the shares it owns in the group’s low-cost carrier Jin Air (LJ, Jeju) to be directly held by the flag carrier, it revealed in a statement on June 13.

The move appears to confirm reports that emerged over a month ago that it is a manoeuvre ahead of Korean Air’s long-awaited merger with Asiana Airlines (OZ, Seoul Incheon), to position a combined low-cost carrier that also integrates Asiana’s Air Busan (BX, Busan) and Air Seoul (RS, Seoul Incheon) under the flag carrier’s direct control.

The assumption is that elevating the flagship airline as a de facto intermediary holding company would enhance the group’s dominance, creating synergies between the carriers by centring on Korean Air. Combining the budget carriers in this way would also resolve any regulatory issues with the merger ahead of time, and it would help optimise the route network by solving...

Korea’s Air Busan in $160mn share issue, Asiana ups stake

Air Busan (BX, Busan) plans to issue 43.5 million new common shares with the aim of raising KRW200.1 billion won (USD160 million), it said in a series of stock exchange disclosures on May 31. Meanwhile, the budget carrier’s cash-strapped parent, Asiana Airlines (OZ, Seoul Incheon), will buy additional stock to raise its shareholding to just under 42%.

A general meeting of shareholders approved the stock offering, the proceeds of which will be used to finance operations and for debt repayment. The 43.5 million shares will be sold to the company’s shareholders at a price of KRW4,600 (USD3.68) per share.

Due to the inevitable dilution of the stock’s value, Air Busan’s share price declined sharply on the news. The airline had previously said that it would reduce the number of its existing 190 million common shares by a third to improve its financial structure.

Also on May 31, Air Busan’s biggest shareholder Asiana Airlines announced in a filing that it would be increasing its stake to 41.98% by acquiring additional shares in the...

Korean Air board mulls fate of integrated post-merger LCCs