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The merger is currently being scrutinized by the United States, the European Commission, and antitrust bodies in Japan, although 14 nations, including South Korea, China, Australia, Singapore, Thailand, and Vietnam, have already granted their approvals.
The European Commission, the antitrust regulator of the European Union, has decided to temporarily suspend its investigation into the proposed merger between Korean Air Lines Co. and Asiana Airlines Inc. This pause comes as Korean Air requested more time to develop measures that address concerns related to competition.
On Thursday, Korean Air announced that the European Commission had postponed the conclusion of the probe, which was originally scheduled for August 3. Sources within the airline industry in Seoul suggest that the competition watchdog will likely reach a final decision regarding the merger, which aims to create the world’s seventh-largest carrier, around October.
An official from Korean Air stated, “We have requested a deadline extension to render comprehensive remedies that can address the European Commission’s concerns, and the European Commission approved the request.” The airline intends to promptly submit a remedy package and finalize discussions with the authority within the new deadline to obtain final approval.
According to the European Commission’s website, the probe on the 1.8 trillion won ($1.4 billion) deal was temporarily halted on June 23. This decision followed the European Commission’s issuance of a statement of objections to Korean Air in May, expressing concerns about the potential impact of the acquisition of Asiana on competition in the markets for passenger and cargo air transport services between the European Economic Area and South Korea. The commission had initiated a full-scale investigation into the merger back in February.
In the United States, the Department of Justice, the country’s competition regulator, notified Korean Air last month that it would reject the purchase of Asiana if the deal were to result in the creation of a dominant player without a significant rival in South Korea’s aviation industry, according to individuals familiar with the matter.
Earlier this month, Korean Air Chairman and CEO Cho Won-tae pledged to take all necessary measures to secure approvals from the relevant authorities. The merger is currently being scrutinized by the United States, the European Commission, and antitrust bodies in Japan, although 14 nations, including South Korea, China, Australia, Singapore, Thailand, and Vietnam, have already granted their approvals.
Tatiana is the news co-ordinator for TravelDailyNews Media Network (traveldailynews.gr, traveldailynews.com and traveldailynews.asia). Her role includes to monitor the hundrends of news sources of TravelDailyNews Media Network and skim the most important according to our strategy. She holds a Bachelor degree in Communication & Mass Media from Panteion University of Political & Social Studies of Athens and she has been editor and editor-in-chief in various economic magazines and newspapers.
