Asiana to sell affiliates to help reduce massive debt

Asiana Airlines’ board of directors has decided to sell major cash cow affiliates, including Kumho Terminal, in an effort to improve the company’s balance sheet by lowering massive deficits.

According to the nation’s second-largest airline, it has decided to sell off a 100 percent stake of Kumho Terminal, as well as a 50 percent stake in Kumho Asiana Plaza Saigon (KAPS).

Kumho Terminal owns roughly 20 terminals across the country and is the real estate owner of Shinsegae Department Store in Gwangju as well as the Gwangju bus terminal.

KAPS is a landmark skyscraper
in the heart of Ho Chi Minh City in Vietnam, which is made up of three buildings - a 21-story hotel, 32-story residential housing and a 21-story office building.

The price of the 100 percent stake in Kumho Terminal is 270 billion won ($240 million), while the 50 percent stake in KAPS is valued at 123 billion won.

The sale of the affiliates is expected to help lower the airliner’s debt-to-asset ratio from 991 percent to 778 percent.

Last year, the company suffered a deficit amounting to 81.5 billion won, forcing it to make changes including merging several of its overseas branches and outsourcing some of the less important businesses.