March 6 (Bloomberg) -- Korean Air Lines Co., South Korea’s biggest carrier, was the sole bidder for a stake in Czech state airline Ceske Aerolinie AS.
Korean Air offered to pay 2.64 million euros ($3.44 million) for 44 percent stake in CSA, the ministry said in an e-mailed statement today. The bid was based on an earlier estimate by Ernst & Young that valued the airline at 148.5 million koruna ($7.6 million). Korean Air’s offer meet all the conditions and is binding, the ministry said.
The offer has “great” potential for the further development of both CSA and Prague’s international airport, Finance Minister Miroslav Kalousek told reporters. If the contract is signed, Prague’s Vaclav Havel Airport will become a European hub for Korean Air, Kalousek said.
The government should assess the bid at its next session and the Finance Ministry will recommend accepting it, Kalousek said. If the government approves the offer, the final contract could be signed in the second half of April, he added.
The Czech government sent a letter to about 50 of the world’s largest carriers last year in an effort to find a strategic partner or to sell the loss-making airline to. Qatar Airways, which indicated a preliminary interest in CSA, didn’t submit an offer.
The first attempt to sell CSA in 2009 was scrapped after the only bid cane from Unimex Group and charter carrier Travel Service, which wanted to overhaul CSA. CSA, which reduced its fleet, cut staff and services, is now part of Cesky Aeroholding AS, the operator of Vaclav Havel Airport.
The government would only sell a minority stake in CSA to a non-European carrier, such as Seoul-based Korean Air, in order to keep the status of a European carrier, the ministry has said.
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