Hyundai Development Company has led a consortium to acquire a controlling stake in Asiana Airlines.

The South Korean builder paid $2.16 billion for the slice of the country’s second-biggest carrier.

Kumho Industrial Company, formerly the leading shareholder in the airline, put its 31 per cent stake up for sale earlier this year.

The organisation had come under pressure from Asiana creditors to reduce debt at the loss-making carrier.

Following news of the deal, Aurojyoti Bose, lead analyst at GlobalData, commented: “The acquisition, which also includes Asiana’s subsidiaries and low-cost carriers Air Busan and Air Seoul, will be a breather for the company.

“Asiana Airlines is currently under deep pressure as it owes a total debt of more than US$5.1 as on September 30th.

“The airline’s troubles worsened in 2019 due to a combination of factors such as lower demand for travel to Japan and a weak won against the dollar.”

He added: “The loss-making airlines has been in midst of financial problems in recent years due to trade war between South Korea and Japan resulting in decline in demand for trips between both the countries.

“As a result, for the first nine months of this year, the company posted a net loss of over US$400 million.

“On the other hand, the deal is part of HDC Hyundai Development Co’s plan to diversify its business portfolio.

“The deal will help Hyundai benefit from the synergies as it has been expanding into hotel business and news is also doing the rounds of its likelihood of foraying into inflight duty-free sales.

“At the same time, HDC intends to help lower Asiana’s debt-to-equity ratio, improve profitability by streamlining routes and enhancing cost effectiveness.”