South Korean activist fund KCGI eyes Asiana Airlines stake, shares soar

South Korea's activist fund KCGI, the second-largest shareholder in the parent company of Korean Air Lines, said it was looking to buy a controlling stake in Asiana Airlines, helping send shares of the carrier up 26%. KCGI CE Kang Sung-boo said the fund is in talks with several local and overseas entities to form a consortium to bid for the 31.05% stake in Asiana, which has been put up for sale by top shareholder Kumho Industrial. The stake was worth US$282m at Friday's close. Kang's comment comes as the local airline industry grapples with several challenges, including rising competition from budget carriers, a US-China trade war hitting cargo demand and a Korea-Japan diplomatic row hurting travel. Korean Air Lines and Asiana Airlines swung to operating losses for the April-to-June quarter, from a year earlier. <br/>