LONDON – The South Korean low-cost carrier, Fly Gangwon, has been listed for sale after selecting Samjeong KPMG and KR&Partners as co-organizers in fund raising and the change of management rights.
Fly Gangwon has suffered from business difficulties over the last few years, leading to fund raising being required to sustain operations. Presently, the carrier has been officially listed for sale.
The details
Fly Gangwon, the South Korean low-cost carrier (LCC), has been in a deep business struggle for the past few years, which has now led to the airline being listed for sale with the help of Samjeong KPMG and KR&Partners.
Founded in 2016, the Yangyang-based airline commenced operations in November 2019 with a fleet of Boeing 737-800s. The airline currently operates a minimalistic fleet of two Boeing 737-800s and one Airbus A330-200.
The airline was hit hard by the Covid-19 pandemic which came just months after their launch, resulting in the suspension of a majority of their international flights.
The fundraising is set to be carried out in the form of issuing new shares, of which it is reported that large corporations and strategic investors are considering to invest in.
Currently, the largest stakeholder in Fly Gangwon is Joo Won-seok, the Chief Executive Officer of the company, who holds a 44.2% stake in the airline, with the second biggest being Seven Bridges Private Equity, with a 5.71% stake.
The airline – A brief summary
Founded in 2016, Fly Gangwon is based out of South Korea’s Yangyang International Airport (YNY).
Fly Gangwon received their first of three Boeing 737-800s in September of 2019, creating the base fleet for the initial launch of the airline.
The first three Boeing 737-800s all came from Norwegian (DY), carrying the former registrations of LN-NGG (HL8376), LN-NGF (HL8377) and LN-NOY (HL8380).
However, these airframes are no longer active in their fleet, but either operative elsewhere or stationed with the lessor.
At the time of writing, the Fly Gangwon fleet consists of three aircraft, being one Airbus A330-200 and two Boeing 737-800s with their previous histories in TUI and GOL, according to planespotters.net.
With the initial launch taking place in November of 2019, Fly Gangwon hit the wall rather quickly as the Covid-19 pandemic set a temporary end to the majority of international flights.
With travel demand dropping heavily, the company reportedly started facing business difficulties.
However, with the world slowly opening again and the travel demand spiking, Fly Gangwon reopened their service to Clark in the Philippines last year, which has reportedly given an increase in sales.
Overall
Despite the boost from service resumptions last year, it remains apparent that Fly Gangwon are in a great deal of difficulties, seeing that the airline is listed for sale and urgently needing funds.
However, their situation shortly after launch due to Covid-19 does not come as a shock, as the aviation world has experienced lately that it is hard to be a new airline in these times, both pre-and post-pandemic.
With Fly Gangwon’s current situation being complicated, it can only be hoped that a business solution or purchase agreement goes through in the near future.
