Korean Air Seeks to Buy Asiana (Recent News Article)
#31
Moderator: Asiana & Qantas Frequent Flyer
Join Date: Dec 2006
Location: STR/SYD/SMF
Programs: QF SG, LH SEN, OZ D+, HH D, SPG P
Posts: 14,344
For me this doesn't sound like a merger but just as an outright takeover of OZ by KE. I might be wrong but KE is significantly larger so this is not a merger of equals.
#32
Join Date: Nov 2013
Location: NYC
Programs: OZ Diamond *A Gold / Delta Gold
Posts: 775
My fingers are crossed for this happening. At worst it pauses the acquisition for a time while HDC tries to make its case (I have no idea how quickly or slowly the courts there act on such matters, but regardless, it'll buy a few months). At best HDC wins its case and is willing to acquire Asiana and keep it independent.
In any case, I'm nowhere near 500k so if KE closes the merger and thus closes the door on lifetime *G, I'll have to decide if I want to go shopping for another program or stick with KE.
In any case, I'm nowhere near 500k so if KE closes the merger and thus closes the door on lifetime *G, I'll have to decide if I want to go shopping for another program or stick with KE.
HDC has until end of Jan to try to make the case that if they receive the same conditions as KE, this is a deal they would consider. As described above, the difference of treatment was quite big so it can be a thought.
#33
Join Date: Nov 2013
Location: NYC
Programs: OZ Diamond *A Gold / Delta Gold
Posts: 775
It's a political merger, so it doesn't really matter. If KE wanted to absorb OZ, they would try to see if OZ goes bankrupt or not. Right now, this is being pushed forward by the authorities so there is not much they can do about it. There are some conditions they will have to follow which will have to make the merger acceptable, and probably look "fair". How this all gets executed is a whole different matter.
#34
Join Date: Jan 2014
Posts: 557
Does anyone with a good understanding of how things work have a point of view on what this means for Asiana Club miles? I am wondering whether I ought to use them proactively as soon as possible rather than wait and see if they are devalued or become time limited in a time window which might not suit me.
#35
Join Date: Jan 2014
Location: SFO
Programs: OZ Diamond/*G, IHG Diamond Amb, Hilton Gold
Posts: 2,238
Does anyone with a good understanding of how things work have a point of view on what this means for Asiana Club miles? I am wondering whether I ought to use them proactively as soon as possible rather than wait and see if they are devalued or become time limited in a time window which might not suit me.
#36
Join Date: Jan 2017
Location: PHX, ICN
Programs: OZ Diamond Plus, Marriott Gold
Posts: 501
I would use them ASAP as they will either become Korean Air miles which were recently massively devalued and are almost useless except for one-way non-stop short-haul flights in economy on routes not served by LCCs or they will become completely useless. I can't imagine them not honoring tickets already issued though, so you can book as far out as the schedule allows. For example, when US Airways merged with AA, Star Alliance awards booked on the US Airways program were still valid after they switched to Oneworld and same for LATAM AFAIK.
So I'd plan to use miles sooner-rather-than-later, but I wouldn't book something now just to burn them.
#37
Join Date: Jan 2017
Location: PHX, ICN
Programs: OZ Diamond Plus, Marriott Gold
Posts: 501
Ahh...so basically one chaebol outsmarted another in using the government so no more Asiana...
They had a pretty reasonable path to profitability, if they could just separate themselves from the Kumho group that kept using Asiana's profits to help other parts of Kumho instead of buying new planes that they desperately needed, but clearly the Cho family has a lot of sway over the Korean government and this deal is very very good for them.
HDC might be one of the biggest losers from this deal, not just because they didn't get to buy Asiana, but because they will only have one choice for corporate travel. There's a lot of competition in the Korea international market and the 3rd country transit via Korea market, but this is gonna hurt Seoul-based companies needing an airline for business travel because if they want to have a managed corporate travel type program, KE will be the only choice, and it may be the only nonstop option on many routes (and let's face it, execs of big Korean companies aren't going to be flying LCCs), allowing them to charge quite a bit.....I have to wonder if another conglomerate without an airline might suddenly become interested in buying Asiana given the alternative is paying a lot more for corporate air travel for the forseeable future.
They had a pretty reasonable path to profitability, if they could just separate themselves from the Kumho group that kept using Asiana's profits to help other parts of Kumho instead of buying new planes that they desperately needed, but clearly the Cho family has a lot of sway over the Korean government and this deal is very very good for them.
HDC might be one of the biggest losers from this deal, not just because they didn't get to buy Asiana, but because they will only have one choice for corporate travel. There's a lot of competition in the Korea international market and the 3rd country transit via Korea market, but this is gonna hurt Seoul-based companies needing an airline for business travel because if they want to have a managed corporate travel type program, KE will be the only choice, and it may be the only nonstop option on many routes (and let's face it, execs of big Korean companies aren't going to be flying LCCs), allowing them to charge quite a bit.....I have to wonder if another conglomerate without an airline might suddenly become interested in buying Asiana given the alternative is paying a lot more for corporate air travel for the forseeable future.
#38
Join Date: Jan 2014
Location: SFO
Programs: OZ Diamond/*G, IHG Diamond Amb, Hilton Gold
Posts: 2,238
My one caveat to this advice would be that you probably don't have to burn your miles immediately. This will take time to play out, and then time to implement, and then time to accomplish. KE buying OZ is a big deal, and they won't be crushing anything currently running fine within OZ for months afterwards, and I'd bet 1+ years. That said, KE has shown they will give no notice before they announce changes (See what they did with their own program) - but still, most of those plans didn't start going into effect for some time.
So I'd plan to use miles sooner-rather-than-later, but I wouldn't book something now just to burn them.
So I'd plan to use miles sooner-rather-than-later, but I wouldn't book something now just to burn them.
#39
Join Date: Jan 2017
Location: SFO/SJC/OAK
Programs: OZ Diamond (*G), KQ Asante Gold (ST+), Hilton Diamond, IHG Diamond, Marriott Gold
Posts: 1,506
Did the KE Skyteam chart get devalued as well? I know KE used to be 40k o/w in J from US-Europe just like OZ, did that go up?
#40
Join Date: Jan 2014
Location: SFO
Programs: OZ Diamond/*G, IHG Diamond Amb, Hilton Gold
Posts: 2,238
#42
Join Date: Jan 2017
Location: SFO/SJC/OAK
Programs: OZ Diamond (*G), KQ Asante Gold (ST+), Hilton Diamond, IHG Diamond, Marriott Gold
Posts: 1,506
This is going to be an absolutely worthless program. Redeem your miles ASAP everybody!!
#43
Join Date: Apr 2005
Programs: Starwood:Lifetime Platinum, Air Canada:Basic, Asiana:Lifetime Diamond Plus, ANA: Basic
Posts: 980
I finally found the page with the new award charts, holy .... this is TERRIBLE! I didn't realize they were switching to a distance-based chart like Avios, with most longhaul redemptions literally doubling in price. I just redeemed some miles for a winter trip to Brazil, and I'll be looking to get rid of the rest with 1 last Europe redemption in the summer.
This is going to be an absolutely worthless program. Redeem your miles ASAP everybody!!
This is going to be an absolutely worthless program. Redeem your miles ASAP everybody!!
There may also be other offers to Asiana by other South Korean firms now vaccine is in sight. We thought Hyundai was going to buy Asiana just like end of last year. Now it's Korean Air. Maybe tomorrow it's Samsung or others. It's not settled until the process passed regulatory anti-trust issues.
Even if Korea Air is buying Asiana is approved, the deal doesn't close until at least summer 2021. Then it will be another year or two or three for integration. If we use Marriott swallowing SPG as an example, it was 2015. It wasn't until 2018 before the frequent staying guest programs were merged. So unless South Koreans are super efficient compared to staff at Marriott/SPG, it will take about the same 3 years is my guess.
#44
Join Date: Aug 2008
Programs: HHonors Gold, Marriott Lifetime Gold, IHG Gold, OZ*G, AA Gold, AS MVP
Posts: 1,874
Even if Korea Air is buying Asiana is approved, the deal doesn't close until at least summer 2021. Then it will be another year or two or three for integration. If we use Marriott swallowing SPG as an example, it was 2015. It wasn't until 2018 before the frequent staying guest programs were merged. So unless South Koreans are super efficient compared to staff at Marriott/SPG, it will take about the same 3 years is my guess.
#45
Join Date: Jan 2017
Location: SFO/SJC/OAK
Programs: OZ Diamond (*G), KQ Asante Gold (ST+), Hilton Diamond, IHG Diamond, Marriott Gold
Posts: 1,506
It could be, although if we use another airline merger as an example (AA/US), one thing that people might get worried about is OZ exiting Star early. US Airways exited Star Alliance to join Oneworld a couple of years before their FFP was fully merged with AA's, so OZ being pulled out of *A to join Skyteam a couple years before the FFP merges into Skypass would affect some people's redemption options (no full Japan partner, trading TG and SQ for VN and GA and the entire LH family for AF/KL/OK, etc).