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Delta Air Lines acquires stake in Korean Air's parent Hanjin Kal

Delta Air Lines acquires stake in Korean Air's parent Hanjin Kal

FILE PHOTO: A Delta Air Lines flight is pushed put of its gate at the airport in Salt Lake City, Utah, U.S., January 12, 2018. REUTERS/Mike Blake/File Photo

(Reuters) - Delta Air Lines said on Thursday it has acquired 4.3% stake in Korean Air Lines Co Ltd’s parent company Hanjin Kal Corp.

The No.2 U.S. airline also intends to raise its stake to 10% in the company over time, after receiving regulatory approval, the company said.

Ownership discussions with family members have been ongoing at Korean Air Lines and its majority-owned company Hanjin Kal after their patriarch’s sudden death in April raised questions about the future of the airline and its parent.

Hanjin Kal has been led by 43-year-old Walter Cho since the death of his father Cho Yang-ho, who was the former chairman. However, it has yet to inform regulators about the officials who are going to lead the group, which has diversified businesses including hotels, logistics and budget airlines.

Cho’s widow, two daughters and son hold stakes in Hanjin Kal.

The late tycoon died at the age of 70 following chronic illness, just weeks after shareholders decided to end his 27-year tenure on the airline’s board.

The change at the top comes soon after a local activist fund raised its stake in Hanjin Kal to nearly 16%, bringing the group’s ownership structure to wider attention. The Cho family has 17.8% stake in Hanjin, while its academic foundations own 29%.

Both Delta and Korean Air are members of the SkyTeam alliance and have a joint venture operating flights between Asia to the United States.

A spokesman at Korean Air, the flagship unit of Hanjin Kal, declined to comment.

Reporting by Rachit Vats in Bengaluru; Editing by James Emmanuel

Topic: #delta
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