South Korea: Air carriers take desperate steps for survival

Korean Air and other local airlines are struggling to come up with additional rescue measures that will ensure their survival in the airline industry crisis amid ongoing restrictions on overseas travel due to the COVID-19 pandemic, industry officials said Wednesday. The carrier has decided to sell its in-flight catering and duty free units to Hahn & Company, a local private equity fund, as part of efforts to overcome its liquidity crisis. After a board of directors meeting Tuesday, the airline said it had decided to give the company the exclusive rights to negotiate for the sales of the two units. "Korean Air will continue to consult with Hahn & Company regarding follow-up steps, such as due diligence," a Korean Air official said. Industry officials estimate the sale price of Korean Air's in-flight catering unit at about 1t won ($836m). Following the announcement, the Korean Air union issued a statement, calling on the company to immediately stop its attempt to sell off the in-flight catering and duty free businesses as "such a plan is causing job instability among employees." The sales plan comes as the carrier has faced a setback in its attempt to sell its vacant property in Songhyeon-dong, central Seoul, for about 500b won due to the Seoul Metropolitan Government's plan to build a park there.<br/>