Share trading halted [Asiana financial troubles]
Apr 15, 2019, 10:09 am
#46
Join Date: Jul 2012
Location: SG & SYD
Programs: OZ Diamond
Posts: 180
Who will become Asiana's new owner.
Who Will Become Asiana Airlines' New Owner? - ??????? - BusinessKorea
Who Will Become Asiana Airlines' New Owner? - ??????? - BusinessKorea
Apr 15, 2019, 12:13 pm
#47
Join Date: Aug 2009
Location: Left Coast
Posts: 862
A week ago Asiana was a cash cow for Kumho Group, widely regarded as too big to fail, and now it is up for sale. It would not look good for the Korean government if Asiana fails to meet its debt obligations; the Moon administration already propped up Kumho Group back in 2017, can they really afford to let everything collapse now?
Originally Posted by Korea Herald
Kumho Asiana Group puts Asiana Airlines up for sale to stay afloat
[...]
"(The group) has been trying to come up with the best way to normalize Asiana Airlines," the official said, speaking on condition of anonymity.
"It decided that selling Asiana Airlines will be the way for both the group and the airlines to regain market confidence."
The group earlier proposed selling the airline company under its self-rescue plan to be submitted to its creditors but only after three years and if it fails to turn the company around.
However, its nine creditors, led by the state-run Korea Development Bank (KDB), are said to have dismissed the proposal as insufficient to regain market trust.
The airline swung to a net loss in 2018 from a 248 billion-won ($218 million) net profit the year earlier.
The KDB, meanwhile, said in a press release that Kumho Asiana has submitted its self-rescue plan that includes the proposed sale of Asiana Airlines. (Yonhap)
[...]
"(The group) has been trying to come up with the best way to normalize Asiana Airlines," the official said, speaking on condition of anonymity.
"It decided that selling Asiana Airlines will be the way for both the group and the airlines to regain market confidence."
The group earlier proposed selling the airline company under its self-rescue plan to be submitted to its creditors but only after three years and if it fails to turn the company around.
However, its nine creditors, led by the state-run Korea Development Bank (KDB), are said to have dismissed the proposal as insufficient to regain market trust.
The airline swung to a net loss in 2018 from a 248 billion-won ($218 million) net profit the year earlier.
The KDB, meanwhile, said in a press release that Kumho Asiana has submitted its self-rescue plan that includes the proposed sale of Asiana Airlines. (Yonhap)
Apr 16, 2019, 6:22 pm
#49
Join Date: Jan 2017
Location: PHX, ICN
Programs: OZ Diamond Plus, Marriott Gold
Posts: 502
I did not see any mention of a definite 25 April shutdown on that website, but It shouldn't be hard to find $50M by 25 April if they find a buyer, so I would say that everything is still very much undecided. Right now, it appears that the only options are complete liquidation or a new owner, which will almost certainly have a negative impact on the Asiana Club/*A arrangement they have now. If nothing else, I would imagine that the 500k lifetime status and 40k/24 month *G options will be gone if the airline does survive, even if they do stay in *A. Unfortunately for me, I just earned 18k miles on a mileage run for OZ the very same week that this thread started, after losing status on NH. I was well on pace to hit *G by the end of the summer. Now it looks like I get to start all over again from scratch, possibly on TK since I don't plan on any flights to/from Greece.
Apr 17, 2019, 12:51 am
#50
Join Date: Nov 2013
Location: NYC
Programs: OZ Diamond *A Gold / Delta Gold
Posts: 775
I did not see any mention of a definite 25 April shutdown on that website, but It shouldn't be hard to find $50M by 25 April if they find a buyer, so I would say that everything is still very much undecided. Right now, it appears that the only options are complete liquidation or a new owner, which will almost certainly have a negative impact on the Asiana Club/*A arrangement they have now. If nothing else, I would imagine that the 500k lifetime status and 40k/24 month *G options will be gone if the airline does survive, even if they do stay in *A. Unfortunately for me, I just earned 18k miles on a mileage run for OZ the very same week that this thread started, after losing status on NH. I was well on pace to hit *G by the end of the summer. Now it looks like I get to start all over again from scratch, possibly on TK since I don't plan on any flights to/from Greece.
Apr 17, 2019, 6:58 am
#51
Join Date: Jan 2010
Posts: 1,333
No one can say for certain, but the bottom line is that it appears their only option for survival at this point is a new owner. Once a new company takes over, all bets are off, as they will have their own ideas and allegiances. Since they would be taking over a company that was struggling, it is fairly obvious that they will reexamine how they operate, looking to increase profits and decrease expenses. It's also not at all unreasonable that the new company may be approached by Oneworld, or they may already be invested in Oneworld, so any previous commitments to *A are out the door with new owners. Of course, this is all just speculation on what is possible, not what is certain. Regardless, I would be surprised if the new owners will be quite as generous with handing out status, especially lifetime status, regardless of whether they stay in *A or not. They could also be changing the rules about how many flights need to be on OZ metal to qualify. All we can do is wait and see for now; I just hope it is settled in time for my next travel at the end of July.
Apr 17, 2019, 7:18 am
#52
Join Date: Sep 2013
Location: DXB / KUO
Programs: AY, SQ, EK
Posts: 858
I don't fully understand all this drama. I would be very surprised to see any disruption to the operations of Asiana.
Financial statements are public, and it doesn't look all that bad. There is no track record of massive losses - and USD/KRW rates always have an impact on the net line. Admittedly there have been question marks around book values of some of the assets and OZ need to refinance debt.
I'm not very familiar with Korea, but my assumption is that they play by local rules and this situation will be managed just fine. The government would step in if needed.
Have I missed something?
Financial statements are public, and it doesn't look all that bad. There is no track record of massive losses - and USD/KRW rates always have an impact on the net line. Admittedly there have been question marks around book values of some of the assets and OZ need to refinance debt.
I'm not very familiar with Korea, but my assumption is that they play by local rules and this situation will be managed just fine. The government would step in if needed.
Have I missed something?
Apr 17, 2019, 8:27 am
#53
Join Date: Nov 2013
Location: NYC
Programs: OZ Diamond *A Gold / Delta Gold
Posts: 775
I don't fully understand all this drama. I would be very surprised to see any disruption to the operations of Asiana.
Financial statements are public, and it doesn't look all that bad. There is no track record of massive losses - and USD/KRW rates always have an impact on the net line. Admittedly there have been question marks around book values of some of the assets and OZ need to refinance debt.
I'm not very familiar with Korea, but my assumption is that they play by local rules and this situation will be managed just fine. The government would step in if needed.
Have I missed something?
Financial statements are public, and it doesn't look all that bad. There is no track record of massive losses - and USD/KRW rates always have an impact on the net line. Admittedly there have been question marks around book values of some of the assets and OZ need to refinance debt.
I'm not very familiar with Korea, but my assumption is that they play by local rules and this situation will be managed just fine. The government would step in if needed.
Have I missed something?
Apr 17, 2019, 1:31 pm
#54
Join Date: Jan 2014
Location: SFO
Programs: OZ Diamond/*G, IHG Diamond Amb, Hilton Gold
Posts: 2,239
My wife will be Diamond by mid June and I am planning a Y+ trip to hit it in late June. How fast do you think they could/would change the status requirements (As I too believe the requirements will change though I am far less convinced that leaving *A is a good idea)?
Apr 17, 2019, 8:33 pm
#55
Join Date: Sep 2018
Programs: Alaska
Posts: 2,188
No buyers outside Korea are crazy enough to throw money at a Korean company. Traditionally Korean/Japanese companies are not managed for shareholders' interest. Often the one controlling the companies control the company through a lot of cross-shareholding so that they can control the company with little money.
Apr 19, 2019, 7:07 am
#57
Join Date: Jan 2010
Posts: 1,333
I would wait at least one more week, since there is a deadline coming up fast (April 25??). Hopefully, there will be some kind of announcement early next week about the current/future status. The consensus seems to be that someone will step in to keep them afloat, but nothing is certain yet.
Apr 19, 2019, 7:33 am
#59
FlyerTalk Evangelist
Join Date: Sep 1999
Location: New York, NY, USA
Posts: 12,482
Apr 19, 2019, 3:03 pm
#60
Join Date: Jan 2010
Posts: 1,333
According to a post on airliners, Asiana just got a $700m load from a state owned bank. Not sure if this is good news or bad news; the airline will definitely be able to keep operating in the short term, but it just delays the inevitable sale and takeover. I would much rather hear that they found a buyer, since that would reduce they time we are stuck in limbo waiting for all the chips to fall.