The sale of the Korea Aerospace Industries, or KAI, collapsed again as it failed to attract enough bidders on Monday.

Hyundai Heavy Industries, the world’s largest shipbuilder, placed its bid, but Korean Air, the nation’s flagship carrier, decided not to join the competition. At least two bidders are required to participate in bidding for the KAI sale to proceed.

Korean Air said in a statement that it gave up the bidding because stock price of the state-run aircraft maker is overvalued.

The first bid in August collapsed for the same reason, as Korean Air was the sole bidder.

The state-run Korea Finance Corp., or KoFC, which has led the sale of a 41.75 percent stake in KAI as the largest shareholder, reportedly expressed disappointment over Korean Air dropping out.

Korean Air had expressed its strong will to take over KAI as part of a vision to become the biggest aerospace company in Asia by 2020.

Regarding the outlook for the sale of KAI, the KoFC said it will have a shareholders’ meeting soon to decide whether or not to make a private contract with Hyundai Heavy Industries. The ruling allows shareholders to make a private contact with the sole bidder if the bidding is delayed twice due to lack of competition.

Industry watchers, however, say it is not certain that KoFC will push for a contact with Hyundai Heavy Industries within this year as the nation’s new president will be selected on Wednesday.

Two candidates for the presidential election take a different path for the sale of KAI.

Ruling party presidential candidate Rep. Park Geun-hye doesn’t oppose the privatization of KAI, but her rival Moon Jae-in from the main opposition Democratic United Party is against the privatization of KAI.

Shares of KAI rose 3.09 percent to 26,700 won on Monday. KAI’s 41.75 percent stake was valued at 1.08 trillion won ($1 billion) based on Monday’s closing share price.

By Seo Jee-yeon (jyseo@heraldcorp.com)