SEOUL, April 15 (Reuters) - Shares in South Korea’s Asiana Airlines rose more than 25 percent on Monday after local media reported that its parent group had agreed to sell a stake in the country’s No.2 airline.
Reports of the stake sale came after Asiana’s creditors last week rejected a restructuring plan drawn up by parent Kumho Asiana Group.
Officials from Kumho Asiana Group and creditors have been negotiating a fresh restructuring plan since the initial proposal was turned down, two officials from a main creditor told Reuters.
The parent group is expected to submit a fresh revamp plan after affiliate Kumho Industrial, the top shareholder in Asiana, holds a board meeting on Monday, the officials said.
Shares of Kumho Industrial also jumped 25 percent.
The Korea Economic Daily said late Sunday that cash-strapped Kumho Asiana Group had reached an agreement to sell a stake in Asiana, surrendering to creditors’ request for a better restructuring plan.
Kumho Industrial holds a 33.5 percent stake worth 385 billion won ($339 million) in Asiana at Friday’s closing price.
Na Chul-hee, a spokesman for Kumho Asiana Group, said Kumho Industrial planned to hold a board meeting Monday morning, but did not provide further details.
South Korea’s second-biggest carrier has been struggling to get its finances in order as it battles rising fuel costs and competition from low-cost carriers.
“This is going to be a hot deal, as many local conglomerates want to get into the airline business so there are expectations over a coveted takeover deal,” said Lee Han-joon, an analyst at KTB Investment Securities. ($1 = 1,135.3000 won) (Reporting by Ju-min Park and Hayoung Choi; Editing by Chris Gallagher)
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