Seoul, Jan 22 Daemyung Sono Group, a leading condominium and resort company in South Korea, said on Wednesday it is seeking to acquire management control of low-cost carrier (LCC) T'way Air to improve the airline's operations and financial health.
Sono International, the holding company of Daemyung Sono Group, said it is ramping up its engagement with T'way Air, demanding management improvements and requesting access to the register of shareholders, reports Yonhap news agency.
The group, T'way Air's second-largest shareholder with a 26.77 per cent stake, on Monday submitted a demand for the LCC to overhaul its management team, while calling for a capital increase through a rights offering.
In its demand, Sono International criticised T'way Air for inadequate investment in maintenance and personnel, as well as poor adherence to aviation safety oversight.
It also highlighted the airline's low operational reliability, high rate of corrective action and fines imposed by the Ministry of Land, Infrastructure and Transport, which it argued have tarnished the airline's brand image.
Sono International plans to submit a shareholder proposal to nominate new directors at T'way Air's upcoming annual general shareholders' meeting in March.
The group intends to form a new board of directors to establish a stable operational strategy, improve financial structure and enhance overall management.
Sono International emphasised that its demands and proposals are proactive measures aimed at fostering T'way Air's growth and enhancing shareholder value.
"We aim to maximise customer satisfaction for T'way Air and enhance shareholder value by leveraging Daemyung Sono Group's extensive domestic and international infrastructure to launch diverse products and strengthen customer services," Seo Jun-hyuk, chairman of Daemyung Sono Group, said.
The group is also reviewing the possibility of acquiring another LCC, Air Premia, having purchased an 11 per cent stake in the airline owned by JC Partners in November.
"We are reviewing the merging of the two airlines if we are able to secure the management rights of T'way Air and Air Premia," a Sono International official said.
The official added the merger, if realised, would result in a new carrier capable of operating a wide range of routes, from domestic and short-to-medium routes in Asia to long-haul routes in Europe and the Americas.
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