Air Incheon named preferred bidder in race for Asiana's cargo business

An Asiana Airlines aircraft takes off at the Incheon International Airport in October last year. [YONHAP]

Air Incheon, a cargo carrier, has been reportedly selected as a preferred bidder to acquire the freight business of Asiana Airlines.

Korean Air Lines, which is set to merge with Asiana Airlines, and UBS, the lead manager for the sell-off, internally selected a consortium led by cargo-focused Air Incheon after consulting with the European Commission, according to local media reports. The final decision is expected to be made at Korean Air’s board meeting on Monday.

The takeover will be completed by October.

Asiana Airlines decided to sell its cargo business, which is valued at around 1 trillion won ($724 million), last year, in response to the European Commission's concerns over the potential monopolization of European cargo routes after the merger.

Three budget carriers — Air Premia, Eastar Jet and Air Incheon — took part in the bidding, which began in February, as Jeju Air chose to drop out from the bid at the last minute.

The proposed merger of Korean Air and Asiana Airlines was initiated in November 2020 and is now in its fourth year. The merger deal now only awaits approval from the United States among the 14 mandatory reporting countries, with the European Commission having announced its approval on February 13.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]