Korean Air is said to be considering splitting its aerospace business into a separate subsidiary to raise funds from external investors, a move that would attract a lot of investor interest because of the stable profits offered by the business.

South Korea’s largest carrier is reportedly in talks with Credit Suisse about the investment bank having a role in a possible external fundraising.

The airline’s aerospace business recorded revenue of 740.4 billion won ($668.5 million) and operating income of 38.5 billion won in 2019, which represents more than 10% of its total revenue and operating income. Korean Air generated earnings before interest, tax, depreciation and amortization of 53 billion won in the same period.

If the decision is made to separate the aerospace division from other operations, the enterprise value could be as much as 1 trillion won, analysts said.

The division’s steady profitability has continued to attract interest from investors. Activist fund KCGI – which is in a battle with Hanjin KAL, the parent of the carrier – has also argued that separation of the division from Korean Air would increase shareholder value.

“The value of the division is estimated to be very high even when considering revenue from third-party customers only,” an industry insider said. “This is the reason that selling all or part of the division has been considered as one of the options for solving the carrier’s cash problems by many observers.”

Korean Air operates one of the country’s two largest aerospace businesses, along with Korea Aerospace Industries. It provides maintenance services not only to civil aircraft but also to the South Korean and U.S. air forces, making the unit less sensitive to economic slowdowns. It also has growth potential, with experience and technology in unmanned aerial vehicles.

If the carrier decides to sell a minority stake in its aerospace business, many investors would show interest because of its strong market position, industry watchers said. The division would be able to meet most of the maintenance demand from domestic carriers after the planned combination of Korean Air and Asiana Airlines.

“Nothing is certain but (the business) is clearly attractive,” said an official at a private equity firm. “We will consider investment if there is a stake sale.” (Reporting by Ik-hwan Choi)