The European Commission (EC) has approved Korean Air’s proposed acquisition of fellow South Korean carrier Asiana Airlines. The approval is in the form of a conditional clearance, which is subject to Korean Air’s compliance with certain commitments that it agreed to with the EC.
The EC issued a Statement of Objections regarding the Korean Air-Asiana merger in May 2023, in which it expressed competition concerns in regard to both the passenger and cargo markets. To address the concerns, Korean Air offered commitments that primarily included divestment of Asiana’s cargo freighter business and support for the entry of a new airline on four overlapping passenger routes between South Korea and the European Union.
To implement the cargo commitments, Korean Air and Asiana are required to appoint an advisory firm to oversee the divestment of Asiana’s cargo business, open a bidding process, and select a buyer for the business. EC approval of the selected buyer will be required to close the merger between Korean Air and Asiana. The actual cargo divestment is to take place after Korean Air completes its acquisition of Asiana.
Under the passenger commitments, the South Korean low-fare carrier T’way Air has been appointed as the “remedy taker” on the four designated European passenger routes. Beginning in the second half of 2024, T’way Air will gradually initiate operations on the routes, which include Seoul Incheon-Paris, Seoul Incheon-Rome, Seoul Incheon-Barcelona, and Seoul Incheon-Frankfurt. Korean Air intends to provide support to T’way Air.
Korean Air filed merger notifications concerning its proposed Asiana acquisition with 14 competition authorities. With EC approval now secured, thirteen of the regulatory authorities have now either approved the merger or concluded a review on the grounds that the merger is not subject to review or report. The 14th authority is the U.S. Korean Air said that it continues to be focused on its discussions with the U.S. competition authority in order to finalize the overall merger review processes as soon as possible.
Raymond Jaworowski currently co-authors three of Forecast International's best-selling products: Civil Aircraft Forecast, Military Aircraft Forecast, and Rotorcraft Forecast. As a contributor to Aviation Week & Space Technology's Aerospace Source Book, he has authored Aircraft Outlooks, and provided input for the publication's Aircraft Specifications tables. Raymond has represented Forecast International at numerous conferences and trade shows, often as a featured speaker. He is a member of the American Helicopter Society.
