SK Telecom Gets Green Light for Hanaro Telecom Acquisition
February 23, 2008
On February 20, South Korea's Ministry of Information and Communication conditionally approved the proposal made by SK Telecom to acquire a controlling stake of 38.9% in Hanaro Telecom from a consortium consisting of American International Group and Newbridge Capital. The value of the deal is estimated at US$1.2 billion, Dow Jones News reported.
Upon completing the acquisition, SK Telecom will become the biggest shareholder of Hanaro Telecom with a total stake of 43.6%. In addition to approving the acquisition deal, the ministry also granted SK Telecom the exclusive right to continue using the 800Mhz mobile phone frequency.
Obtaining the official approval enables SK Telecom ?South Korea's largest wireless operator - to enrich its mobile phone services leveraging Hanaro Telecom's expertise in IPTV (Internet Protocol Television) services, according to the same report. However, in order to ensure fair competition among all telecom operators, the Korean government sought to prevent SK Telecom and Hanaro Telecom from monopolizing the market by restricting the marketing of bundled services.