Hyundai Development wants to renegotiate Asiana Airlines acquisition after debt surge (updated)

IPark Hyundai Development

09/06/2020 03:29

(Recasts and adds details of debt incurred)
    By Joyce Lee
    SEOUL, June 9 (Reuters) - South Korea's Hyundai Development
Co  294870.KS  said on Tuesday it wants new terms for its
acquisition of Asiana Airlines  020560.KS  after debt at the
troubled carrier increased by some $3.8 billion.
    A consortium led by the property developer agreed in late
December to purchase the airline for about 2.5 trillion won 
($2.1 billion). 
    Since then, however, Asiana Airlines recognised an
additional 2.8 trillion won of debt as of end-2019 and borrowed
1.7 trillion won more, Hyundai Development said in a statement. 
    The unexpected increase, the carrier's failure to discuss
the situation with Hyundai Development before incurring more
debt and its support of unsound affiliates had prompted Hyundai
Development to ask creditors to renegotiate the deal, the
developer said.
    Hyundai Development added that it still wants a deal to
proceed despite the COVID-19 pandemic that has hammered the
aviation industry.
    "Whether the group survives or not hinges on this deal," it
said.
    Asiana Airlines declined to comment. Korea Development Bank,
its lead creditor, did not have an immediate comment. 
    The airline had total debt of 13.2 trillion won as of
end-March, according to regulatory filing.

($1 = 1,198.4300 won)

 (Reporting by Joyce Lee; Editing by Edwina Gibbs)
 ((jungyoon.lee@tr.com; +82 2 6936 1467;))