The Australian Competition and Consumer Commission (ACCC) has granted unconditional clearance to the proposed merger between Korean Air and Asiana Airlines. Under the deal, Korean Air, advised by Gilbert + Tobin (G+T), will acquire a majority interest in Asiana which is worth about $1.6bn.
Elizabeth Avery, G+T’s lead partner on the deal and its head of competition and regulation, said: “The airline industry has experienced significant disruption in the past few years. We are delighted to have worked together with Korean Air to achieve such a fantastic result, enabling Korean Air and Asiana to continue to provide a competitive offering to and from Australia.”
Even though the merger has been approved by the ACCC, it still requires regulatory approval in other jurisdictions like the US, EU, China, Japan, and the UK. So far, the acquisition has been approved by South Korea, Turkey, Vietnam, Taiwan, Singapore, and Malaysia.
Competition watchdogs in nine other countries are investigating if the merger will substantially lessen competition on routes in and out of their jurisdiction previously operated by Korean Air and Asiana Airline.
Korean Air and Asiana are currently the only airlines operating the route between Sydney and Seoul. Both Korean Air and Asiana operate cargo flights between South Korea and Australia.
In April, Qantas and Jetstar announced they would be launching direct flights from Sydney to Seoul Incheon International Airport later this year. With both Jetstar and Qantas offering flights, passengers will have the choice of full-service business, premium leisure, and low-cost travel options to South Korea.
However, the ACCC concluded that the Korean Air, Asiana combination would not significantly impact competition in the field.