SEOUL, Oct. 20 (Korea Bizwire) — Asiana Airlines Inc., South Korea’s second-largest air carrier, plans to decide on whether to sell its cargo business later this month, as Korean Air seeks to win antitrust approval from European Union (EU) regulators for its takeover of the rival, industry sources said Friday.
Asiana is set to hold a board meeting on Oct. 30 to make a decision on the planned sale of its cargo business, the sources said on the condition of anonymity.
The EU antitrust regulators have raised concerns that Korean Air’s acquisition of Asiana may restrict competition in the markets for passenger and cargo air transport services between the EU and South Korea.
Korean Air said it plans to submit formal remedies to address such concerns to the European Commission (EC), the EU’s executive body, by the end of the month.
It is widely believed that the sale of Asiana’s cargo business and a plan to return landing slots for four European cities will be included.
In a statement sent to Yonhap News Agency, Korean Air said it is “working closely with the EC and will submit formal remedies by the end of the month as requested by the authority to address the concerns.”
Korean Air said it was unable to share further details.
The upcoming Asiana board meeting is expected to be watched closely by stakeholders and EU regulators, as it could potentially make or break the acquisition deal that has been pursued for the past three years.
Even if Asiana Airlines board decides to sell the cargo business, the immediate approval of the merger by the European Commission is not guaranteed, but the chances of obtaining a conditional merger approval are expected to increase.
As of now, it remains unclear whether the plan will be approved at the board meeting.
Six members of Asiana Airlines’ board of directors — two internal directors and four external directors — are reviewing various aspects of the sale. Opinions among board members are reportedly mixed.
A representative at Asiana Airlines said the company did not have a position on related discussions, as the acquisition deal as a whole was being handled by Korean Air.
Korean Air has received acquisition approvals from 11 countries, including Britain, Australia, Singapore, Vietnam, Turkey and China, and is awaiting decisions from Japan, the EU and the United States.