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In the event of a request for a provisional injunction being summoned, the acceptance was canceled … “Management defense” vs “The only way”
The court decision to determine the fate of Korean Air and Asiana Airlines’ integration comes out on 1st.
According to the legal community, Section 50 of the Civil Settlement of the Seoul Central District Court (Senior Vice President of Judge Lee Seung-ryun) will decide whether to sue or reject the interim injunction request against the issuance of new shares issued by KCGI against Han Jin Kal.
Previously, KCGI requested an interim injunction, stating that Korean Air’s method of raising funds for the acquisition of Asiana Airlines was illegal and asked for the issue of new shares for the capital increase to be invalidated. paid by Hanjin Kal, in which the Korea Development Bank participates.
On the 25th, the judiciary held a temporary injunction questioning, listened to the views of both sides and received a written rebuttal to review the law.
The judiciary reportedly focused on justifying the purpose of issuing new shares, the adequacy of means and the possible alternative to issuing new shares.
KCGI claims that Korean Air’s acquisition of Asiana Airlines, obtained by investing 800 billion won in Hanjin Kal, was aimed at defending the management rights of group president Hanjin Cho Won-tae.
KCGI pointed out that it is procedurally illegal for the management of a company in dispute over management rights to decide to issue new shares excluding shareholders.
He said alternatives exist to finance the Asiana Airlines acquisition without changing the current quota structure.
KCGI’s alternatives are issuing bonds, raising capital to shareholders and financing through the sale of assets.
On the other hand, Hanjin Group said: “Although there is a plan to guarantee equity capital without the burden of redeeming new shares assigned to third parties, the claim to issue bonds that are obliged to repay principal and interest or to sell activities that are a source of continuing profits is an urgent selfish claim that it is urgent to keep the ownership relationship rather than the company’s profits. He has refuted that the KCGI alternative is not feasible.
Korean Air’s decision to take over Asiana hinges on whether the court sues or dismisses the injunction, and the industry is thrilled with the court’s decision.
KCGI insists that “we must honestly admit that the deal is possible regardless of the outcome of the process,” but the KCGI said, “(If quoted), the joint deal with Korean Air and Asiana Airlines will inevitably end and, in this case, we will quickly devise the next best option and continue to promote “I said.
If the court rejects the application for a temporary injunction, the acquisition process should speed up.
Korean Air expects to pay the advance for the acquisition of Asiana Airlines later this month using the funds guaranteed by KDB’s investment.
If the decision to issue new shares is no longer valid, KDB’s investment will also be prohibited and Korean Air will not be able to secure the funds to acquire Asiana Airlines.
To escape the liquidity crisis caused by the novel coronavirus infection (Corona 19), it is difficult for Korean Air, which is selling its assets, to raise a separate fund for the acquisition of Asiana Airlines worth more than 1 trillion won.
As major domestic airlines have already announced they have no plans to acquire Asiana Airlines, it seems difficult to find new buyers in the short term.
In this case, Asiana Airlines has no choice but to initiate the restructuring under the management of creditors.
/ news yunhap
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