Bumpy road ahead of KAL-Asiana tie-up

 

SEOUL — Controversy escalated Sunday over the proposed business integration plan of South Korea’s two flag carriers — Korean Air Lines and Asiana Airlines — as to whether the fundraising plan of Korean Air’s parent company Hanjin KAL to achieve the tie-up is legally viable.

State-run lender and creditor Korea Development Bank has addressed concerns over the possibility of an injunction court order that might kill its plan of providing 800 billion won ($716 million) to Hanjin KAL in return for at least 10.6 percent of voting rights plus exchangeable bonds. The KDB capital injection is viewed as the backbone of Korean Air’s 1.8 billion-won deal to control its indebted …

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