S.Korea's Jin Air says plans to list by year-end amid China tensions (updated)

Mirae Asset Securities

25/04/2017 02:00

* Listing comes as diplomatic spat scares off China tourists 
    * Aims to use funds for investment, improve finances 
    * Market value likely less than rival Jeju -report 
 
 (Add background, share prices) 
    SEOUL, April 25 (Reuters) - South Korean budget airline Jin 
Air Co Ltd on Tuesday said it has chosen Mirae Asset Daewoo Co 
Ltd  006800.KS  to manage its initial public offering (IPO), and 
that it aims to complete the offering by the end of this year. 
    The IPO comes as flag carriers feel the impact of political 
tension with China, which has pulled down the number of Chinese 
tourists. This has dimmed the outlook for South Korean airlines 
already bracing for rising competition from the low-cost rivals. 
    Jin Air said in a statement it would use the planned listing 
on South Korea's main stock exchange to improve its financial 
health, fund investment for sustainable growth and for other 
purposes. 
    The budget affiliate of the country's biggest carrier, 
Korean Air Lines Co Ltd  003490.KS , said it aims to increase 
market share by expanding its fleet to 30 jets and routes to 55 
by 2018, from 22 and 36 respectively at present. It also targets 
revenue of over 1 trillion won ($881 million) in that year, from 
719.7 billion won last year. 
    Jin Air is wholly owned by Hanjinkal  180640.KS , a holding 
company of Korean Air. MoneyToday on Monday said the IPO is 
likely to give Jin Air a market value of 500 billion won to 700 
billion won, lower than that of rival Jeju Air Co Ltd 
 089590.KS . 
    Jeju Air was South Korea's first budget airline to list on a 
domestic stock market, debuting in November 2015 at 49,500 won 
compared with an IPO price of 30,000 won. Its shares closed at 
32,300 won on Monday. 
($1 = 1,135.1000 won) 
 
 (Reporting by Hyunjoo Jin; Editing by Richard Pullin and 
Christopher Cushing) 
 ((hyunjoo.jin@thomsonreuters.com; 82-2-3704-5685; Reuters 
Messaging: hyunjoo.jin.thomsonreuters.com@reuters.net)) 
 
Keywords: JIN AIR IPO/