Aju Business Daily

SEOUL -- To ride out a liquidity crisis, South Korea's troubled Kumho Asiana Group begged for a new bailout of 500 billion won ($441 million) from creditors, promising to improve its financial status through the active sale of non-core assets and planes. The group's ruling family offered shares and private assets as collateral.

In a three-year rehabilitation scheme submitted on Wednesday, Kumho proposed that creditors could sell off Asiana Airlines, the country's second-largest flag carrier, at random, according to Korea Development Bank (KDB), a state policy ban which has pressed the group to present

KDB has urged the group to submit a revised self-rescue package aimed at resuscitating Asiana since its chairman, Park Sam-koo abandoned all executive posts at group units on March 28 to take responsibility for causing market disturbances and liquidity woes.

Last year, KDB signed a memorandum of understanding (MOU) that required Asiana to improve its financial status through sales of noncore assets and the issuance of convertible and perpetual bonds. Financial regulators want Kumho to submit a credible self-rescue plan if it wants a debt rollover.

Asiana has tried to resolve liquidity concerns and repay its maturing debt by raising money through asset sales and the issuance of convertible bonds and asset-backed securities. However, the company lost market confidence last week due to its unclear 2018 financial statement, raising concerns about its debt repayment and a group-wide liquidity crunch.

Due to currency-related losses and increased jet fuel costs, Asiana swung to a net loss of 10.4 billion won last year from a net profit of 248 billion won a year ago. Asiana's debt stands at 3.2 trillion won.