[June 22, KOREA WAVE]Air Incheon, South Korea’s only cargo airline, has become the new owner of Asiana Airlines’ cargo division. Korean Air will complete its merger with Asiana by selling the Asiana cargo division.

Korean Air held a board meeting on the 17th and officially selected Air Incheon as the preferred negotiating partner for the sale of Asiana Airlines’ cargo business.

Korean Air said it took into consideration a number of factors behind its selection, including transaction certainty at the time of business acquisition, maintaining the long-term competitiveness and development and growth of the air cargo business, and the ability to mobilize funds through a powerful consortium.

The contract terms will be discussed with Air Incheon during July and a memorandum of understanding for the sale will be concluded, after which the transaction will be subject to review and approval by European competition authorities.

Air Incheon was established in 2012 and is Korea’s only airline that specializes in air cargo. Some have pointed out its limitations, such as its limited experience in transporting short-distance cargo mainly on Asian routes. However, it has also been praised for demonstrating its expertise as Korea’s first airline that specializes in cargo.

Air Incheon has risen to second place in Korea’s cargo business after acquiring Asiana Airlines’ cargo division. Asiana Airlines’ cargo business had a market share of 19.4% as of the first quarter, second only to Korean Air. Cargo sales in the first quarter amounted to 353 billion won.

Currently, Asiana Airlines operates a total of 11 freighters, including eight of its own and three leased. Air Incheon is expected to increase its business competitiveness by utilizing Asiana Airlines’ medium and large freighters and long-distance route network in the U.S. and Europe.

A Korean Air official explained, “In selecting this preferred negotiating partner, we took into consideration all aspects to maintain the current competitive environment while also promoting the growth of the air cargo industry, which is a core industry for the nation.”

(c)NEWSIS/KOREA WAVE/AFPBB News