UK grants de facto approval of Korean Air's Asiana takeover

The UK's top watchdog for market competition on Monday accepted corrective measures submitted by Korean Air Lines Co. on its proposed takeover of Asiana Airlines Inc. in what industry observers say is de facto approval of the acquisition.

The move has also raised the prospects of the merger's approval from the European Union (EU) and the US.

The UK Competition and Markets Authority (CMA) on its website said, "The CMA considers that there are reasonable grounds for believing that the undertakings (takeover of Asiana) offered by Korean Air Lines Co., Ltd., or a modified version of them, might be accepted by the CMA under the Enterprise Act 2002."

Earlier on Nov. 14, the authority had delayed the review by saying, "The CMA has decided, on the information currently available to it, that it is or may be the case that this merger has resulted or may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom."

The US antitrust watchdog also extended its evaluation of the merger two days later.

Korean Air on Nov. 21 submitted a plan on corrective actions on the takeover to the CMA to alleviate the latter's concerns, with the content apparently accepted. The authority called the corrective measures adequate so no decision was announced given the lack of a second examination. The only thing remaining is hearings on additional market opinions on the measures and final approval is expected soon.

Because the UK is a leading destination of many flights in Europe, Korean Air's acquisition of Asiana is highly like to gain approval in other countries whose antitrust authorities are reviewing the merger like the US, EU, Japan and China.

Write to Seo-Woo Jang at suwu@hankyung.com