MBK Partners' Special Situations Fund (MBK Partners Special Situation Fund II) is expected to participate in an acquisition bid for Asiana Airlines, Inc. (KOSE:A020560)'s cargo business by teaming up with a domestic low-cost carrier (LLC), according to company officials and industry watchers on April 7, 2024. The Special Situations Fund II is the Asia-focused private equity firm's second fund with a size of KRW 2.1 trillion ($1.8 billion) established in 2021. Yet, it is largely undecided which domestic carriers will be partnering with the private equity fund for the acquisition bid.

?It's a deal that's out in the market, and the Special Situations Fund is reviewing whether to join the acquisition deal. But nothing has been decided for now,? an official from MBK Partners told The Korea Times on April 07, 2024.

Early last month, UBS, the lead advisor for the sale, announced the shortlist of four LCCs - Jeju Air (Jeju Air Co. Ltd. (KOSE:A089590)), Air Premia (Air Premia Inc.), Eastar Jet (Eastar Jet Co.,Ltd.) and Air Incheon (Air Incheon Co. Ltd) - as potential buyers of the airline's cargo business.

Given that only businesses with Air Operator Certificate (AOC) accreditation are eligible to participate in the bidding process, MBK Partners is required to join hands with one of the shortlisted carriers, if the private equity fund aims to enter the bid. Considering the limited financing capabilities of the shortlisted candidates, some of the low-cost carriers are mulling over the possibility of partnering with multiple financial investors with ample cash to strengthen their funding power to win the bidding. The seller - Korean Air - plans to select a preferred bidder as early as next month, as the first round of bidding is slated to be held at the end of this month.

While the sales price of the cargo business is estimated to be around KRW 500 billion to KRW 700 billion, potential buyers, who are currently conducting due diligence over the deal, are reportedly aiming at a lower price.