As Korean Air began to take over Asiana Airlines in earnest, it was the first to come to a height as it was caught in a lawsuit that could destroy the takeover itself.

Following the filing of a lawsuit by KCGI, an activist private equity fund (PEF), which has confronted Hanjin Group Chairman Cho Won-tae over the management of Hanjin Group, conflicts between employees of the two companies are expressed, and the acquisition is expected to be a difficult journey.

The interrogation of KCGI's'temporary injunction against issuance of new shares for Hanjin Kal's resolution for a paid-in capital increase assigned to a third party' will be held at the Seoul Central District Court on the afternoon of the 25th of this month.

Since the 2nd of next month is the date of payment of the Hanjin Kal's paid-in capital increase by Korea Development Bank, it is expected that the court's decision will be made by the 1st of next month at the latest.

Since the decision to take over, KCGI has insisted that KDB's investment in Hanjin Kal is a means to defend Chairman Won-tae Cho's management and control rights, and requested that the issuance of new shares for Hanjin Kal's 500 billion won paid-in capital increase. I applied for provisional injunction.

KCGI has formed a'Three-Party Shareholders Alliance' in partnership with Bando E&C and former Vice President of Korean Air Cho Hyun-ah and is in conflict with Chairman Cho over management rights.

KCGI seems to have put a brake on the takeover of Asiana Airlines, as KCGI believes that if KDB secures a stake in Hanjin Kal through a third-party paid-in capital increase, it can serve as a'friend' for Chairman Cho.

If KCGI's application for temporary injunction is cited in the court, Korean Air's acquisition of Asiana Airlines may be canceled.

This is because without KDB's investment in Hanjin Kal, it is difficult for Korean Air to secure funds to acquire Asiana Airlines.

Sang-eun Choi, Vice President of Saneun, said at a press conference on the 19th, "If the application for provisional injunction is cited, the combined transaction between Korean Air and Asiana Airlines will inevitably be canceled.

The industry believes that it is unlikely that the court will cite a provisional injunction request, but the court's judgment may vary depending on how you view the purpose of this new share issue.

If the court determines that the issuance of new shares violates the right to take over existing shareholders and that there is no urgent need for management, but the purpose of defending Chairman Cho's management rights, the application for provisional injunction is highly likely to be cited.

Accordingly, KDB and Korean Air are emphasizing that it is an acquisition to reorganize the aviation industry, which is in crisis due to the novel coronavirus infection (Corona 19).

KDB's position, emphasizing that Chairman Cho is retired from the front line of management and not exercising favorable voting rights only for some, is a factor that makes it difficult for the court to interpret the issuance of new shares as defending Chairman Cho's management rights.

Even if the request for temporary injunction is dismissed, KCGI's'countback' will not stop.

On the 20th of this month, KCGI requested Hanjin Kal to convene an extraordinary general shareholders' meeting.

At the extraordinary general shareholders' meeting, the board of directors who led the acquisition of Asiana Airlines and decided to hold the responsibility of the board of directors, and new directors who combine expertise and independence, will form the majority of the board of directors.

If Hanjin Kal does not accept the convocation of an extraordinary general meeting of shareholders, it may convene a general meeting with the permission of the court.

The conflict between Chairman Cho and the shareholders of the trilateral association, as well as the conflict between Korean Air and Asiana Airlines employees and the no-no conflict, are challenges that Korean Air must solve.

The union joint countermeasure committee composed of four unions of both companies, including Korean Air Pilots' Union, Korean Air Employees' Alliance, Asiana Airlines Pilots' Union, and Asiana Airlines' union, said, "It is necessary to present concrete action plans to prevent restructuring." Urged.

The Joint Action Committee warned that it would prevent mergers and acquisitions through all legal and physical responses without the government's clear statement of position.

On the other hand, the Korean Air Union, which has approximately 12,000 employees excluding Korean Air pilots, said, "We respect the takeover decision," and differed from the four unions.

The Asiana Airlines Open Pilots Labor Union, which initially expressed opposition to the acquisition, has also held back its position on the acquisition.

(Photo = Yonhap News)