Asiana backs sale of cargo unit, removing one hurdle to Korean Air merger

South Korea's Asiana Airlines said on Thursday its board had approved the sale of the company's cargo business - an important step towards allaying EU competition concerns about a proposed takeover by Korean Air Lines. Korean Air, the country's biggest carrier, said in a statement following the decision that it had submitted a package of remedies to the European Commission - remedies that also include it divesting routes to some European Union cities. Analysts said, however, that Asiana's greenlighting of the cargo unit sale did not necessarily ensure smooth sailing ahead for the deal. They noted the desired valuation for the air cargo unit of some 700b won ($520m) including debt, as reported by local media, was probably too high. That could become a new stumbling block for the sale and hence regulatory approval. "The price seems to be way too expensive, and there aren't that many players at home with the means to spend that much money on Asiana's debt-ridden cargo unit ... there are lingering uncertainties," said Bae Se-ho, an analyst at Hi Investment & Securities. And even if the deal gets the nod from the European Union, it still needs approval from the United States and Japan, analysts also noted. Korean Air said in a statement that while it was continuing with "its efforts to secure the approval from the European Commission, the airline will also communicate closely with the remaining regulatory bodies to finalize the approval process as quickly as possible."<br/>