Korean Air mulls bid for stake in Korea Aerospace Industries

Singapore
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Korean Air has confirmed that its parent company could bid for a stake in aircraft manufacturer Korea Aerospace Industries (KAI).

"Hanjin Group will have an internal discussion and make a final decision on whether or not it will submit a letter of intent," a Korean Air spokeswoman said when contacted.

KAI announced on 31 July that four of its shareholders are offering to sell a combined 41.6% stake in the company.

Of the percentage, 11.6% comes from state-owned Korea Finance Corporation, and 10% each from three other shareholders, says a KAI spokesman.

The share sale is estimated to be worth won (W) 1.2 trillion ($1.06 billion).

Although Korean Air has expressed an interest, it has yet to make a formal bid for the stake, says the spokesman.

"The shares are being sold because the government wants one major shareholder so that company decisions can be made more easily," he adds.

KAI will accept letters of intent until mid-August, and aims to complete the stake sale by end 2012.