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Delta invests in partner Korean Air, seeks to expand in Asia

(Reuters) – Delta Air Lines Inc said on Thursday it has acquired a 4.3% stake in partner Korean Air Lines Co Ltd’s parent company with a view to expanding across Asia.

The No. 2 U.S. airline said it intends to increase its stake in Hanjin Kal Corp, which owns about 30 percent of Korean Air, to 10% over time, after receiving regulatory approval. It did not disclose how much it paid for the stake.

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Delta Chief Executive Officer Ed Bastian recently said he viewed the Korean Air and its Incheon International Airport hub in Seoul as a gateway to adding more destinations across Asia. The two airlines formed a joint venture last year that includes 290 U.S. destinations and over 80 in Asia.

Long term the partnership and the joint venture is strong in terms of size and there’s no reason to think it can’t grow substantially into the future,

Bastian said at an aviation summit this month in Seoul.

The investment follows the sudden death in April of Cho Yang-ho, the Hanjin Kal and Korean Air patriarch, which raised questions about the future of both.

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