The auction to sell 41.8 per cent stake in South Korea's only plane manufacturer Korea Aerospace Industries for 1.05 trillion won ($925 million) has not taken off as Korean Air Lines Co (KAI) emerged as the sole preliminary bidder.
State-run Korea Finance Corp, which holds a 26-per cent stake in Sacheon-based Korea Aerospace, said that KAI was the only bidder to register by the 3 pm deadline yesterday.
Korea Finance, Hyundai Motor, Samsung Techwin Co, and Doosan Group together hold 56.7 per cent in KAI, and they had put around 10 per cent each of their stake for sale earlier this year, including management control.
There will be limited suitors for the stake since under Korean national-security laws, only domestic companies can hold stake in the civilian and military plane manufacturer and there must be two or more bidders for the pubic auction to proceed.
The shareholders will now meet to decide whether to run another auction Korea Finance said in a statement yesterday.
Formed through the 1999 joint venture between the aerospace divisions of Samsung, Hyundai and the now defunct Daewoo Heavy Industries, Korea Aerospace was taken over by other Korean companies at the behest of the government when the company ran into financial trouble during the 1997 Asian economic crisis.
The company makes civilian and military planes and helicopters as well as multipurpose satellites.