Minister Kim Hyun-mi Calls Jeong Mong-gyu and Chae Hyung-seok to "Make Efforts for Airline M&A"

[Image source=Yonhap News]

[Asia Economy Reporter Moon Jiwon] Kim Hyun-mi, Minister of Land, Infrastructure and Transport, met sequentially with Chung Mong-kyu, Chairman of HDC Group, Chae Hyung-seok, Vice Chairman of Aekyung Group, and Lee Sang-jik, Democratic Party lawmaker (former chairman of Eastar Jet Group), urging them to make efforts to ensure the success of airline mergers and acquisitions (M&A).

According to the Ministry of Land, Infrastructure and Transport on the 3rd, Minister Kim met with Chairman Chung and others to hear explanations on the progress and positions of each company's M&A. She also requested that the airline M&A be successfully completed as originally planned.

Minister Kim is also reported to have expressed that if the intention to acquire is clear, the government will provide maximum support at the government level in consultation with related ministries.

The airline M&As, including HDC Hyundai Development Company-Asiana Airlines and Jeju Air-Eastar Jet, which have been ongoing since last year, have been virtually halted due to the spread of the novel coronavirus disease (COVID-19).

The sale of Asiana Airlines remains sluggish. HDC Hyundai Development Company holds the position that since Asiana Airlines' debt ratio has significantly changed compared to when the acquisition was signed in December last year, the acquisition of Asiana Airlines should be renegotiated from scratch.

The M&A between Jeju Air and Eastar Jet is also facing difficulties due to issues such as resolving unpaid wages and fulfilling preconditions.

The Ministry of Land, Infrastructure and Transport has supported M&A by providing acquisition financing in cooperation with the Ministry of Economy and Finance, the Financial Services Commission, and designating special employment support industries.