Policy lender Korea Development Bank on Monday turned its blame to Hyundai Development Co., the proposed buyer of indebted Asiana Airlines, over its delayed 2.5 trillion-won ($2.09 billion) acquisition deal from Kumho Industrial, the owner of the troubled air carrier.
The KDB, one of the creditors of Asiana Airlines, also refused to accept HDC’s call for an extra round of 12 weeks of due diligence on the nation’s No. 2 air carrier -- in addition to the previous seven-week process -- adding that KDB could spare no time to make a new decision as the deal is on the verge of collapse later in August.
“If the deal falls apart, all the blame must go to HDC,” KDB Chairman Lee Dong-gull told reporters at a teleconference Monday. “Kumho and Asiana creditors acted sincerely, but HDC raised the risk of the deal collapse.”
Lee added the intention of the proposed buyer -- led by the real estate developer -- to conduct extra due diligence is pointless, given its claims that Asiana stakeholders failed to comply with requirements to provide documents and financial information are groundless and distorted. HDC said Thursday that additional due diligence is critical, citing its need to avert the risk of investment based on “unreliable financial statements.”
“(Creditors) cannot delay the decision further. Time is drawing near to make a decision,” Lee said.
KDB Vice President Choi Dae-hyun said HDC’s call for repeated due diligence “cannot be accepted,” given its disrespectful attitude and “lack of sincerity” to close the deal as the HDC-led investor group has remained absent from the negotiating table.
Choi added that KDB is open to turning to alternative plans if the deal ends in failure on a deadline. Asiana Airlines are eligible to get financial support from KDB’s contingency fund, according to Choi. KDB will remain a credit holder until the air carrier’s operation goes back to normal, so that KDB would be able to find a new buyer.
The proposed buyer, composed of HDC and Mirae Asset, and seller Kumho Industrial have been gridlocked over the deal they signed in December 2019, forcing the deadline for payment on July 24 to be pushed to Aug. 12.
The HDC-led consortium paid a deposit of 250 billion won for the deal, which Choi said is expected to be another point of contention if HDC demands the payment be redeemed.
Creditors composed of KDB and Export-Import Bank of Korea rolled out plans in April to inject a combined financial package of 1.7 trillion won in the latest decision.
By Son Ji-hyoung (firstname.lastname@example.org