Integrated Airline Takes Off, Leaving 10.58%—Focus Turns to KDB's 'Exit Calculus' for Hanjin KAL Stake [FN Market Watch]

[Financial News] Following the integration of Korean Air and Asiana Airlines, attention is turning to Korea Development Bank (KDB) in relation to Hanjin KAL's governance structure. The 10.58% stake in Hanjin KAL acquired to support the integration is a key block that could alter the balance between Hanjin Group Chairman Walter Cho's side and Hoban Group.
As the integration process enters its final stages, KDB's role is increasingly likely to shift from providing support to exiting the investment. The stake acquired for 500 billion won is now worth more than 900 billion won, giving the policy lender both stronger justification and greater practical benefits for recovering its investment.
According to DS Investment & Securities on the 6th, KDB's 10.58% stake in Hanjin KAL is currently valued at approximately 934.3 billion won. That represents a valuation gain of about 434.3 billion won compared with the 500 billion won acquisition price.
The weight of KDB's stake is even greater given the current shareholder structure. Walter Cho's side holds 20.57%, while Hoban's side holds 20.15%, a difference of just 0.42 percentage points.
Hoban increased its stake to 20.15% in July. Its stated purpose remains "simple investment." Meanwhile, Japan Airlines (JAL) recently acquired a new stake in Hanjin KAL, drawing market attention to the possibility that Walter Cho's side could expand its friendly holdings.
DS Investment & Securities identified KDB's method of selling the stake as the key issue going forward.
Kim Soo-hyun, head of the research center, explained, "If the stake is transferred to a specific party through a negotiated private sale, controversy could arise that a policy financial institution supported a particular major shareholder's efforts to defend management control." This is why the possibility of open competitive bidding is being discussed relatively prominently.
If a public sale goes ahead, Hoban is considered the candidate with the strongest acquisition incentive so far. If KDB's stake passes to Walter Cho's friendly camp and the prospect of a shareholding contest disappears, the strategic value of Hoban's stake could decline.
Hoban's calculations are complicated as well. Acquiring KDB's entire stake would raise its ownership to 30.73%, requiring it to consider regulatory burdens such as being classified as an affiliate.
Conversely, if a management-control dispute is formalized, KDB could become less able to sell its stake to either side.
Walter Cho's side also cannot be assessed based solely on its ownership percentage. Its effective voting stake, excluding public-interest foundations and other entities, is estimated to be in the 17% range. However, the direction of friendly holdings, including those of Delta Air Lines, LX Pantos, and funds related to Daishin Securities and Eugene Investment & Securities, could determine its defensive strength.
An IB industry source said, "After the integrated airline is launched, the policy need for KDB to remain a Hanjin KAL shareholder may be lower than in the past. If it actually moves to sell the stake, the key variable in the governance structure will be how, to whom and how much of the stake it transfers, rather than the price."
The source added, "The next governance variable at Hanjin KAL can be seen as KDB's exit rather than Hoban's additional purchases. As the 500 billion won invested to support the integrated airline has grown into a stake worth in the 900-billion-won range, market attention is shifting from why KDB should continue to hold the stake to when and how it will recover its investment." 

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