Air Busan buys back W12b shares for first time

[THE INVESTOR] Air Busan, the budget carrier affiliated with Asiana Airlines that is seeking an initial public offering next year, said on Sept. 19 it has recently purchased its own shares worth 12 billion won (US$11 million) from Meritz Fire and Marine Insurance.

It is the company’s first share buyback since its establishment in 2007.

The company said it purchased 399,000 shares or 3.99 percent of its shares from Meritz on Sept. 13, paying 30,000 won per share.

Considering the book value of the company’s share was priced at 10,433 won last year, the share price has almost tripled over the past year. 

Now, special interest groups have a 49.99 percent stake -- including Asiana Airlines’ 46 percent -- while the Busan City government and other 13 firms hold the remaining 50.01 percent.

Air Busan is preparing for a stock debut but the plan failed to get approval from shareholders last year. The company said it would continue preparations with aims to go public next year.

Last year, the company saw its operating profit soar 60 percent to 33 billion won, largely buoyed by growing demand for short-haul travel to neighboring Southeast Asian countries.

By Lee Ji-yoon (jylee@heraldcorp.com)