Korean Air has come forward to dispel concerns that overseas competition authorities’ scrutiny of the airliner’s merger with Asiana Airlines might be delayed or disrupted.
Korean Air said the airliner has been mobilizing its capabilities to obtain the go-ahead from foreign competition authorities on its merger with Asiana Airlines, saying that to this end, it had spent 35 billion won in consulting fees.
Korean Air released the explanation material to dispel misgivings surrounding the merger on May 23. Korean Air’s latest move came after some news outlets reported that China’s competition authority was looking into a possible monopoly into some Korea-China flight routes.
Korean Air said the Korean Fair Trade Commission gave the merger the nod under preconditions in February, and the airliner was mobilizing its companywide capabilities to obtain a green light from six foreign competition authorities, including the United States and EU, and their scrutiny was going without interruption.
To this end, Korean Air has been operating national task forces consisting of a combined 100 members to obtain an approval on the merger from each competition authority.
The task forces are divided into five teams, including a U.S. strategy team, EU-UK-Australia strategy team, a Japan-China strategy team and a cargo team and an overall affairs team.
Korean Air has struck deals with multiple law firms and consultation companies to cope with demands from each competition authority.
Three international law firms have been designated to oversee the overall process related to the scrutiny by each competition authority while eight Korean law firms have given the task to cope with each country’s examination. Three economic survey firms have been commissioned to secure objectivity and expertise.
As for China, Korean Air has been aggressively coping with China’s scrutiny into its merger with Asiana Airlines by offering supplementary materials on about 10 occasions after it submitted an application to Chinese competition authorities in January 2021.
Competition authorities in Turkey, Thailand, Taiwan and Vietnam have already approved the merger. The Korean Fair Trade Commission gave it the go-ahead on it under preconditions in February.
The merger is still required to obtain a nod from the United States, EU, Japan and China. Even though their approval is not mandatory, scrutiny by UK and Australian competition authorities also gets underway.
Korean Air said U.S., EU, UK and Australian competition authorities had demanded for new airliners’ entry so that an environment similar to that before the merger should be created.
Korean Air have been aggressively persuading Korean and foreign airliner executives to attract new airliners.
Business sources said Korean Air President Woo Ki-hong toured the United States and Europe from late last year until early this year and persuaded foreign airliner executives.
A few airliners had shown their interest in the new market entry, so affirmative outcomes were expected to come out soon, a Korean Air official said.
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