Kumho Industrial, the parent company of struggling South Korean carrier Asiana Airlines, will offload its leisure unit Kumho Resort under a restructuring process after the sale of the airline to Hyundai Development Company collapsed last month.

NH Investment & Securities has been hired to find a buyer for Kumho Resort, industry sources said on Monday (October 12). The auction process is expected to begin before the end of this year.

Kumho Resort has three separate businesses operating resorts, water parks and golf clubs. Some believe that Asiana Country Club, one of the key assets, will alone be worth more than 300 billion won ($261 million), but others are skeptical about the company’s overall value because of its high debts and low profitability.

The company had liabilities of 410.9 billion won at the end of June, representing more than 82 percent of total assets. It  recorded revenue of 75.7 billion won in the first six months, but posted a net loss of 32.7 billion won in the same period.

“Kumho Resort’s debt ratio is too high to draw sufficient interest from potential buyers,” one industry insider contended.

Even if the sale is successful, little cash will be left for Kumho Industrial, industry watchers said. That’s because most of the proceeds are likely to be used to improve the financial health of Asiana Airlines, whose de facto controlling owner is a group of creditors led by the state-run Korea Development Bank (KDB), not Kumho Industrial.

Kumho Resort’s four shareholders are Kumho T&I (48.8 percent), Asiana IDT (26.6 percent), Asiana Airport (14.6 percent)  and Asiana Sabre (10 percent). All except for Kumho T&I are subsidiaries of Asiana Airlines, and the other three companies together also own 80 percent of Kumho T&I.

Another part of the proceeds will be used to repay convertible bonds issued by Kumho T&I to Hyundai Investment Partners in 2017, according to sources.

KDB announced shortly after the deal between Asiana Airlines and Hyundai Development Company collapsed that it would  inject 2.4 trillion won from the government’s Key Industry Stabilization Fund to normalize the airline’s operations. KDB is said to be planning to temporarily nationalize Asiana Airlines through a debt to equity swap, then later find a private buyer.

“For Kumho Industrial, selling Kumho Resort appears to be a punishment by (Asiana Airlines’) creditors, who have made many sacrifices to keep the airline afloat so far,” said another industry insider. (Reporting by Ik-hwan Choi)