Korean Air, Asiana LCCs to be merged, HQ to be decided

Air Busan, Air Seoul, and Jin Air will be integrated into a single low-cost carrier, the president of Korean Air, Kee Hong Woo, has said in an online press briefing on the flag carrier’s Asiana Airlines acquisition progress. But it is too early to say where it will be based, he added. His comments came despite earlier South Korean government assurances that an integrated LCC headquarters would likely be set up at a local airport and not necessarily in Seoul. “We are still considering whether the integrated LCC will be a subsidiary of Korean Air or of [Korean Air parent] Hanjin KAL, as Jin Air currently is. We will decide on the timeline and direction after thoroughly reviewing the details, such as the required funds and restrictions under the Fair Trade Act,” Woo said in the written briefing presented on March 31. Korean Air expects, Woo said, that it will take two years after its US$1.6b acquisition of a majority stake in Asiana Airlines closes before the rival brands can be integrated. “Asiana Airlines will be incorporated as a subsidiary of Korean Air once the business combination reports have been approved. It will create a governance structure where Hanjin KAL owns Korean Air, which in turn controls Asiana Airlines. Korean Air plans to fully integrate with Asiana Airlines about two years after Korean Air completes the acquisition and Asiana Airlines becomes its subsidiary,” he explained.<br/>