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KKL interested in buying a controlling stake in FAT airline

Kinmen Kaoliang Liquor Inc (KKL, 金酒公司), a Kinmen County-run company, expressed interest yesterday in taking up a controlling 51 percent stake in the debt-ridden Far Eastern Air Transport Corp (FAT, 遠東航空), the KKL chairwoman said yesterday.

"We're actively evaluating the feasibility of making an acquisition as it would be in the interest of people in Kinmen to have their own airline," the newly appointed chairwoman, Joanna Lei (雷倩), a former Chinese Nationalist Party (KMT) legislator, said yesterday during a visit to the financially troubled airline.

To revitalize KKL's NT$5 billion (US$160.9 million) in assets, Lei met FAT chairman Lin Bao-chang (林寶漳) yesterday morning and expressed the company's willingness to become the airline company's biggest shareholder.

She said the firm intended to spend NT$2 billion on the acquisition to bail out the airline and ensure a flight route between the offshore island and Taipei.

She said, however, that both sides had yet to finalize the shareholding ratio, which would also require final approval from the Kinmen County government and the council.

Given the lack of efficient transportation between the outlying islands of Kinmen and Taiwan proper, both the Kinmen County Government and the council, as well as the liquor company, have endorsed Lei's plan to invest in FAT.

KKL president Wang Yi-ming (王毅民) said the investment plan would be spearheaded by Lei, who he said is an expert in financing and acquisitions, and that a thorough evaluation would be conducted before any action is taken.

Wang said the liquor company reshuffled its board on Friday after Lei was appointed chairwoman. She proposed the idea of revitalizing the company through mergers or by investing in other industries.

Established in 1952, KKL is the biggest player in the domestic liquor market, with more than NT$11 billion in annual revenues from brewing and sales of Kinmen Kaoliang liquor.
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