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Asiana to hold board meeting to discuss sale of cargo unit
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简介South Korean air carrier Asiana Airlines will reportedly convene a meeting of its board of directors ...
South Korean air carrier Asiana Airlines will reportedly convene a meeting of its board of directors on Oct. 30 to decide whether or not to sell its cargo business, as a part of its efforts to accelerate its merger with its bigger rival Korean Air, industry sources said Friday.
In order for the sale of the company’s cargo unit to be approved, four out of six of Asiana’s directors must agree.
"Nothing has been concretely confirmed in regards to the board of directors' meetings," said an official from Asiana.
The meeting comes as Korean Air, which aims to acquire Asiana, is planning to submit a revised version of its proposal to gain approval for the takeover deal from the European Commission later this month. The remedied proposal is rumored to include Asiana’s sale of its cargo unit to a competing airline.
The resubmission of Korean Air’s acquisition proposal to the EC follows the EC’s concerns that the merged unit could monopolize passenger and cargo flights linking Korea to European cities.
But Asiana’s labor union fiercely opposes the sale of the company’s cargo business.
On Sept. 26, in response to rumors of Korean Air selling Asiana’s cargo divisions, Asiana union released a statement saying that the sale of Asiana's cargo division will result in a hike in passenger and freight fares and, ultimately harm consumer interests.
The labor union added that the cargo unit was one of Asiana’s key businesses, and selling it would weaken the national aviation industry’s competitiveness.
In the first half of 2023, sales generated from Asiana's cargo business accounted for 24 percent of the airline's total sales, second only to sales generated from transporting international passengers (62 percent).
"Selling off Asiana's cargo unit will inevitably ramp up Korean Air's chances of having its merger be approved by the EC. However, whether it will be worth sacrificing one of Asiana's most profitable businesses for the merger is a matter to be discussed in depth, as Korean Air has already given up so much of its valuable assets such as flight routes and such," said an official from the aviation industry on the condition of anonymity.
Currently, Korean Air has received the green light from 11 countries, including Britain, China and Australia, to integrate with Asiana. The airline is currently awaiting decisions from Japan, the European Union and the US, as of third week of October.
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