Few would ever think mergers and acquisitions are easy. Korean Air's attempt to take over Asiana dates to 2020, and it will take a lot of negotiating with the EU to get the deal through.
Korean Air Lines’s proposed acquisition of rival Asiana may restrict competition in passenger and cargo air transport services between Europe and South Korea, EU antitrust regulators said on Wednesday.
The European Commission said it had sent a statement of objections outlining its concerns, confirming a Reuters story last week.
The deal, announced by Korean Air in late 2020, would see it become the biggest shareholder in indebted Asiana, the biggest shake-up in the country’s aviation industry in nearly three decades.
The EU competition enforcer said it had sought feedback from rival airlines, potential market entrants and customers on the potential impact of the deal.
“The transaction may reduce competition in the provision of passenger transport services on four routes between South Korea and France, Germany, Italy and Spain,” it said in a statement.
It said the deal may also reduce competition in the provision of cargo transport services between all of Europe and South Korea.
Korean Air said it would continue to discuss remedies with the Commission.
“Korean Air is confident that the proposed merger will benefit our customers in the market and will make every possible effort to secure the final approval of the merger,” the carrier said in a statement.
(Reporting by Foo Yun Chee; Editing by Kirsten Donovan)
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Photo credit: An Asiana A380. The EU has raised competition concerns about Korean Air Line's proposed takeover of Asiana.