Korean Air Lines Co. forms $195 million joint venture Sinotrans Air

Clients Korean Air Lines Co., Ltd.

Jones Day advised Korean Air Lines Co., Ltd. in its $195 million formation of an air cargo joint venture with Sinotrans Air Transportation Development Co., Ltd. This joint venture is the third Chinese-Foreign air cargo transport joint venture in China. Korean Air and Sinoair contemplate that their joint venture, which has yet to be named, will involve an initial total investment of $195 million, consisting of $65 million as the joint venture company's registered capital. Ownership stake in the joint venture company, in compliance with the aggregate foreign ownership threshold of 49% is as follows: Sinoair (51%), Korean Air (25%), Hana Capital (13%) and SHINHAN Capital (11%). Korean Air is the world's leading commercial airline cargo carrier and Sinoair, currently listed on the Shanghai Stock Exchange, is a unit of Hong Kong listed Sinotrans Limited, an international freight forwarder and China's largest logistics company. The joint venture company, with a term of 30 years, is expected to commence operations in the domestic and international air freight businesses during the second half of 2007.