Korean Air to Buy Asiana Airlines

I normally wouldn’t feel the need to write a short post about a merger as I’m trying to go to sleep, but I think this will interest many.

Korean Air confirms its board has approved acquisition of Asiana Airlines for KRW1.8 trillion (US$1.6B). Korean will raise KRW2.5 trillion by issuing new shares next year. State-backed bank KDB will invest KRW800 billion to support the deal

— Adrian Schofield (@AvWeekScho) November 16, 2020

Korean Air Will Buy Asiana Airlines

I don’t have much more info beyond that. It seems that Korean Air (IATA:KE) will absorb Asiana Airlines (OZ), although one thing I’ve learned in mergers and acquisitions is that the buyer isn’t always the brand that remains.

In 2013, US Airways technically bought American Airlines out of bankruptcy and now half the people reading this are asking “What’s a US Airways?” 😉

My assumption is that Korean Air will be the surviving brand here, but let’s see how it shakes out.

Effect on Korean Air and Asiana Airlines Frequent Flyer Programs

This is where it will get interesting, won’t it?

Korean Air was a favorite Chase Ultimate Rewards redemption partner. That’s because they tend to have quite good First Class redemption space from the US to Korea and on to the rest of Asia. When Chase and Korean Air parted ways in August 2018, many saw it as a huge loss to Ultimate Rewards that Chase still has not replaced to this day.

Asiana, by contrast, is a fan favorite of some hardcore frequent flyers – not because it’s partners with Chase or any other credit cards, but because of program sweet spots like 50,000 Asiana miles to fly one way in First Class to Europe on Lufthansa (booking is only available within 2 weeks of departure). That said, Asiana passes on fuel surcharges, and while Avianca charges 87,000 miles, it doesn’t pass on fuel surcharges.

Notably, Korean Air is in the Skyteam alliance while Asiana is in Star Alliance. Assuming that Korean Air (which Delta also has a small stake in) survives, I expect it to remain in Skyteam.

Both programs are only transfer partners in the US with Marriott Bonvoy.

Marriott Bonvoy Business® American Express® Card: Earn 75,000 Bonus Marriott Bonvoy Points after you use your new Card to make $3,000 in purchases within the first 3 months of Card Membership. Terms apply. | How to apply for this offer.

MilesTalk Musings

We’ll have to see how this pans out, but I know more than one advanced level player that will be sad if the 50k First Class to Europe dissolves with this merger.

The big question is if Korean Air ever becomes a transfer partner of a US credit card again. That would really shine a spotlight back on the new, larger Korean Air for the frequent flyer crowd.

Thoughts?

Let me know below in the comments, on Twitter, or in the private MilesTalk Facebook group.

And if this post helped you, please consider sharing it!

You can find credit cards that best match your spending habits and bonus categories at Your Best Credit Cards. 

New to all of this? My “introduction to miles and points” book, MilesTalk: Live Your Wildest Travel Dreams Using Miles and Points is available on Amazon and at major booksellers.