Asiana Airlines long, drawn out takeover by HDC Hyundai Development Co is now officially dead.
Main creditor Korea Development Bank said HDC knocked back the latest cut-price Covid deal offered by creditors and has been looking to get out of its transaction commitments for some time.
"We believe HDC has no intention to acquire Asiana after all. We’ll end talks and immediately embark on Plan B," a KDB official said.
The deal has been on rocky ground for many months since the Covid-19 pandemic.
HDC and Asiana owner Kumho Industrial had apparently been miles apart on valuation of the airline, as its stock price plummeted due to the pandemic.
HDC cited Asiana Airlines’ plunging value and had asked for a second period of due diligence.
Asiana is likely to agree a debt-for-equity deal with creditors and will seek more than $1.5 billion in state aid.
"The creditors are expected to resume efforts to sell Asiana Airlines once the situation improves," an industry analyst said, Business Korea reports.
Last December HDC signed an agreement to buy Kumho Industrial’s 31% stake in the airline for about $2.2 billion.
Written by Ray Montgomery, Asia Pacific editor
