 |
Photo courtesy of Eastar Jet |
[Alpha Biz= Paul Lee] VIG Partners, the majority shareholder of Eastar Jet, dismissed rumors on August 13 that it is preparing to sell the airline, saying there is no reason to do so just two years after acquisition. “Since acquiring Eastar Jet, revenue has increased and operating losses have narrowed. We have not considered any sale,” the firm said, while acknowledging it had received unsolicited requests from firms seeking to advise on a potential transaction.
In contrast, a securities industry source noted that “talk of an Eastar Jet sale has been circulating in the market” and suggested that if such a sale were to proceed, a securities firm, accounting firm, or law firm would likely be appointed as lead manager. “We will have to see VIG Partners’ true intentions,” the source added.
Industry observers say potential bidders could include Daemyung Sono Group and Aekyung Group, though both companies have denied interest. VIG Partners acquired Eastar Jet from property developer Sungjung in 2023 for ₩40 billion (US$30 million). Private equity firms typically aim to exit investments within about five years.
Eastar Jet posted ₩461.1 billion in revenue in 2023, up 214% from ₩146.6 billion the previous year. Operating losses narrowed 35% year-on-year from ₩57.6 billion to ₩37.3 billion. The airline has stated its goal of returning to profitability within this year.
The sale speculation comes as the airline industry undergoes consolidation, following the Korean Fair Trade Commission’s approval of the Korean Air–Asiana Airlines merger and ahead of the planned integration of Jin Air, Air Seoul, and Air Busan by late next year. In June, T’way Air was acquired by Daemyung Sono Group.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
