Ahead of a proposed auction to sell off Asiana Airlines, four South Korean bidders have been placed on a short list according to CH-Aviation.

Asiana Airlines is owned by the Kumho Asiana Group, a large South Korean conglomerate made up of some of the country’s biggest companies.

Asiana-Airlines-Acquisition-Process
Asiana Airlines have four bidders on a shortlist. Photo: lasta29 Wikimedia Commons

Now to enable the debt-ridden airline to keep flying, one of the group's companies, Kumho Industrial will sell its entire 33.5% stake in the airline, according to the Korean Herald.

Asiana Airlines owns Air Seoul

Seoul based Asiana Airlines is the second-largest full-service airline in South Korea behind Korean Air and has a low-cost subsidy called Air Seoul.

Asiana Airlines is also the largest shareholder in regional budget airlines Air Busan in partnership with the Busan Metropolitan City.

Asiana Airlines, Airbus A380
The airline has 143 Airbus A380 pilots that aren't flying. Photo: Getty Images

Having appointed Credit Suisse to handle the sale, people familiar with the goings-on at Asiana told the Yonhap News Agency that four bidders were now on a shortlist. The four companies looking to acquire a controlling stake in Asiana Airlines are:

  • The Aekyung Group: A conglomerate involved in everything from cosmetics-to-healthcare that that is familiar with the airline industry due to its ownership of low-cost carrier Jeju Air Co.
  • Mirae Asset Daewoo: Korea’s largest investment banking and stock brokerage company following Mirae Asset Securities and Daewoo Securities joining forces in 2016.
  • Hyundai Development Company (HDC): The HDC is a South Korean conglomerate that has subsidiaries in retail, construction, leisure, sports, petrochemicals, and healthcare.
  • Korea Corporate Governance Improvement (KCGI): KCGI is a Korean private fund that invests in multiple projects.
  • Stonebridge Capital: A Korean venture capital company that invests in projects that show potential for long-term growth.

Korea Corporate Governance Improvement and Stonebridge capital are jointly bidding for the stake in Asiana Airlines.

Aekyung says they are the only bidder who knows how to run an airline

In a statement released yesterday, (Wednesday) that has been carried by the Yonhap News Agency, Aekyung was keen to point out that out of all the bidders they are the only one who knows how to run an airline.

Asiana Airlines, Airbus A350, London Heathrow
Asiana has been in dire financial straits for some time. Photo: Tom Boon - Simple Flying

"We are in talks with multiple highly credible financial investors for a partnership in the Asiana auction," the statement said.

Aekyung Group subsidy AK Holdings the majority stake in South Korea’s biggest low-cost carrier by sales Jeju Air Co.

In charge of the Stone Bridge Capital consortium Park Seong-joon said he would release details of his companies bid next week.

Kumho will allow companies not on the shortlist to bid in October

South Korean heavyweights like SK, Hanwha, and CJ had shown an interest when told about the sale but failed to submit bids to the amazement of Kumho.

To this end, Asiana’s creditors and Kumho are still hoping that one of the big conglomerates will make a late bid for the airline.

Consequently, they are reportedly considering letting companies that did not submit bids in the preliminary stage to enter the final bidding in October in the hope that it will raise the sale price.

While speaking to an industry insider the Korea Times, quotes its source as saying:

"Those consortiums led by brokerages or private equity funds will seek to acquire Asiana at the lowest price possible and then sell it to the highest bidder in the future. This isn't what Kumho is looking for."