Hyundai Glovis mulls SI investment in Asiana’s cargo business

[Courtesy of Hyundai Glovis Co.]

Hyundai Glovis Co. is reportedly considering joining the bid for Asiana Airlines‘ cargo business unit.

According to industry sources on Thursday, the transportation subsidiary of Hyundai Motor Group is exploring the option of joining the bid for Asiana’s cargo business unit as a strategic investor (SI) in the Air Incheon consortium.

The consortium is led by private equity firm Socius, with Socius No. 5 Corporate Financial Stability Private Equity Investment Limited Partnership holding 80.3 percent of Air Incheon Co.’s shares. Hyundai Glovis will likely participate via a capital increase in this firm.

Hyundai Glovis has reportedly been considering bidding for this business since the initial stages of the merger and acquisition (M&A) process, with the aim of expanding into the air cargo sector and improving its logistics competitiveness. The company also began construction on a global distribution center (GDC) with advanced automation facilities at the second Incheon International Airport logistics complex in October 2023. The GDC, a five-story building of approximately 44,400 square meters, is scheduled for completion in 2025 and is expected to handle approximately 25,000 tons of new airfreight annually within five years of commencing operations, according to the company.

Hyundai Glovis Chief Executive Officer Lee Kyoo-bok outlined the company’s aggressive growth strategies, including M&A, during an investor event in June 2024. “We will efficiently manage existing assets while ensuring continuous growth momentum through core asset investments averaging about 1.3 trillion won ($950 million) annually,” he said, adding that the company will “actively consider” growth via M&A “as strategically required.”

A company official said Hyundai Glovis is considering the investment but added that nothing has been confirmed. Industry analysts believe that Hyundai Glovis could add value through the investment and secure synergies with other sectors.

Air Incheon’s major shareholders are a consortium of Korean private equity funds, including Socius and Korea Investment Partners Consortium.