Korean Air expects US approval for Asiana merger by end-Oct: report

Korean Air Lines Co., South Korea’s No. 1 full-service carrier, expects to gain full approval from the US government by the end of October to move ahead on the merger with its local rival Asiana Airlines Inc. about four years after the 1.8-trillion-won (1.3 billion) deal announcement, Korean Air Chairman and Chief Executive Cho Won-tae told Bloomberg.

In a recent interview with the news outlet, Cho said he didn’t believe further concessions would be required beyond the divestitures of Asiana’s cargo unit and several long-haul passenger destinations.

Korean Air is selling Asiana’s cargo unit and some lucrative international routes to get the definitive nod from the European Commission (EC) for its acquisition of the country’s No. 2 airline. 

Last year, the antitrust body of the European Union gave preliminary objections to their marriage, citing monopoly concerns.

“We have done everything the US and the EU have requested us to do,” Cho told Bloomberg.

The US is the last of 14 jurisdictions to respond to Korean Air’s proposed merger with Asiana.

Korean Air is also weighing prospects for the merger of three homegrown budget carriers: its subsidiary Jin Air and Asiana’s Air Busan Co. and Air Seoul. Their combined entity will have a fleet of 64 aircraft, according to the report.

NEW ORDERS FOR BOEING AIRCRAFT

For a new order for up to 30 planes to be placed as soon as July, Korean Air is leaning toward the Boeing 787 Dreamliner after it ordered 33 A350s in March, Cho was quoted as saying.

Last year, the flagship carrier added 20 A321neos to its fleet. It is also looking at Boeing’s 777X to order new freighters.

“Boeing is a strong company. I believe in Boeing’s management," the chairman told Bloomberg.

"They will pull through. It might take some time,” he said about the safety lapses and questions over quality control in the US planemaker’s manufacturing process.

Cho plans to enlarge Korean Air’s fleet size to up to 100 planes in five years.

Write to Jung-Eun Shin at newyearis@hankyung.com

Yeonhee Kim edited this article.