DALLAS — Korean Air (KE) announced that China’s antitrust regulator had approved its merger with smaller local rival Asiana Airlines (OZ), with approval from four other countries still pending.
According to standard procedure for markets where the airlines are active, the Korean Air-Asiana merger must be approved by antitrust regulators in the United States, the United Kingdom, Japan, the European Union, and China. China is the first of the four countries to approve the agreement.
The People’s Republic of China’s Ministry of Commerce demanded that the merged Korean Air-Asiana entity reduce its market share due to competition concerns, according to a statement from KE.
Korean Air responded by submitting solutions to a possible monopoly on nine routes between China and South Korea. The airline had previously submitted documents to antitrust regulators in 14 countries for review of its merger with OZ in January last year.
Four More to Go
So far, the merger has received approval for the integration from ten countries: Australia, Korea, Singapore, Vietnam, Thailand, Turkey, Taiwan, Malaysia, China, and the Philippines, while the US, the UK, Japan, and the EU are still considering the merger.
In November 2020, KE agreed to buy a controlling stake in Asiana for ₩1.8tr (US$1.5bn), creating the world’s tenth-largest airline by fleet size.
If the acquisition is completed, KE, the world’s 18th-largest airline by fleet, will become OZ’s largest shareholder, with a 63.9% stake.
Featured image: Korean Air HL8082 787-9 ICN. Photo: Christian Winter/Airways