HDC could derail Korean Air's deal to take over Asiana

HDC Hyundai Development Company, the former prospective buyer in a deal to acquire Asiana Airlines owned by Kumho Industrial, will become a new sticking point in Korean Air's planned acquisition of the air carrier, a National Assembly research report said Tuesday. The fresh claim raises issues over whether the Hyundai subsidiary's deal would have helped spur competition and should therefore be considered a viable alternative to the "mega deal" between the country's largest carrier Korean Air and its cash-strapped second-largest peer, a key point of contention for the Fair Trade Commission (FTC), the country's antitrust agency, to factor in during an upcoming review. The report can become a major headache to Korea Development Bank (KDB) Chairman Lee Dong-gull who reiterated that no risks would lay ahead during the remainder of the state lender-supervised deal. But his remark may become a major source of embarrassment in addition to his repeated failed attempts to carry the 2.5t won ($2.2b) deal given the 800 billion won in taxpayers' money spent in the form of the industry stabilization fund. Also at issue will be whether the FTC will recognize the possibility that the planned merger will solidify the standing of the two already powerful carriers given their combined slots at Incheon International Airport will far exceed 38.5%, the figure of claimed allocation maintained by Korean Air and other creditors.<br/>