Korean Air and Asiana Airlines Merge to Form a Regional Powerhouse

Korean Air has finalized its acquisition of Asiana Airlines, marking the completion of a significant merger that aims to create one of Asia's largest airlines. The deal, valued at 1.8 trillion won (US$1.3 billion), was initially announced four years ago as a strategic move to support Asiana Airlines, which was struggling due to the impact of the COVID-19 pandemic on air travel demand.

Under the terms of the agreement, Korean Air has acquired a 63.88% stake in Asiana Airlines through the purchase of newly issued shares. This acquisition transforms Asiana Airlines into a subsidiary of Korean Air, effectively consolidating the two South Korean carriers into a single entity.

The newly formed Korean Air group is projected to control over half of South Korea's passenger capacity and will rank as the world's twelfth-largest airline by international capacity, according to a Reuters analysis of data from Cirium and OAG. Notably, Korean Air has pledged that the integration process will not result in layoffs, with plans to reassign employees in overlapping roles within the expanded organization.

A Vision for Growth and Stability

In a statement, Korean Air emphasized its commitment to fostering natural staff growth through business expansion, ensuring that the merger benefits both the company and its workforce. This strategic consolidation positions the new Korean Air group to better compete in the global aviation market, leveraging the combined strengths of both legacy carriers.