This article was displayed on the ChosunBiz MoneyMove (MM) site at 3:19 p.m. on Apr. 14, 2026.
Integration work between Korea Railroad Corporation (KORAIL) and SRT operator SR Co. has moved into full swing as the process to select a financial advisor has begun. Observers said the effort to reorganize the dual high-speed rail system, maintained since SRT's 2013 launch, into a single structure has entered the working level.
According to the investment banking (IB) industry on the 14th, KORAIL recently sent out requests for proposal (RFP) to major domestic accounting firms to select a financial advisor for the business transfer between KORAIL and SR Co. The service is a preliminary step for integrating the two companies and is understood to include key financial tasks such as designing the business transfer structure and valuing the company.
The integration is expected to proceed not as a simple merger of the two entities but through a business transfer (asset deal) structure. KORAIL would acquire SR Co.'s assets and liabilities to advance the integration. Given the legal and accounting differences between KORAIL, a public institution, and SR Co., a stock company, it is seen as the most practical integration method structurally.
The industry cites eliminating inefficiencies in high-speed rail operations as the driver for integration. The current split between KTX and SRT has long drawn criticism for duplicative investment in rolling stock, personnel, and maintenance. Analysts say unifying route operations and resource allocation through integration could yield cost savings and improved profitability.
Preparations for physical integration are already underway in parallel. Under the government's high-speed rail integration roadmap, cross-operation between KTX and SRT is being promoted, with pilot runs launched that have SRT departing from Seoul Station and KTX departing from Suseo Station. The measure aims to verify interoperability among trains, tracks, and operating systems in real-world conditions and is seen as a preliminary step premised on future integrated operations.
This advisory work is expected to be the pivotal watershed for the integration. The advisor will conduct financial due diligence on the two companies' assets and liabilities to review their financial condition and contingent liabilities, while also performing appraisals of tangible and intangible assets. It then plans to assess SR Co.'s corporate value using methods such as discounted cash flow (DCF) and, based on that, derive the purchase price and the size of goodwill.
In particular, securing objectivity and appropriateness in calculating the purchase price is expected to emerge as a key issue. Because KORAIL is a major shareholder of SR Co., the deal will inevitably have the nature of an insider transaction among interested parties. Moreover, given that railway infrastructure and operating assets with the character of public assets are included, the transparency and reasonableness of the fair value assessment are also likely to be important criteria. That said, KORAIL and the government are currently the only remaining shareholders of SR Co.
Accounting and tax clean-up work to prepare for after the integration will also proceed in parallel. Because KORAIL and SR Co. differ in their founding forms and accounting standards, they will adjust accounting policy differences and prepare pro forma consolidated financial statements. In addition, the scope includes reviewing whether the merger qualifies for tax benefits and conducting preliminary checks on key tax issues such as corporate tax and value-added taxes.
The industry sees the selection process for the advisor as a turning point that has moved the KORAIL–SR Co. integration beyond policy debate and into a practical execution phase. Once the business transfer structure and integration method are fleshed out based on the financial advisory results, policy decisions and follow-up procedures are expected to accelerate.
An industry official said, "In a business transfer method, the deal structure and financial burden vary greatly depending on how the asset price is calculated," adding, "Once financial due diligence and the corporate valuation are completed, the broad framework of the integration will in effect be finalized."