SK telecom market Chinese spent $1 billion to seize the curve

EST on June 23rd (Beijing time June 24th) news: according to South Korean media reports, South Korea's leading mobile phone business in Korea SK telecom company has invested $1 billion to buy China Unicom 6.6% stake in the company and hope that both sides can establish a closer cooperation relationship in the future.

The opportunities of SK telecom company is facing in excessive competition in South Korea on the domestic market is very limited, it announced that it would buy $1 billion worth of Chinese Unicom in early July in Hongkong listed holding company of convertible bonds.

Korea investment securities analyst, said: in the registered user has reached 39 million people in South Korea's wireless market, SK Telecom accounted for more than half of the country. It has been looking for opportunities to expand its business in the Chinese market."

"SK Telecom plans to develop other new sources of revenue in the country's domestic market, which has now settled."

China Unicom has 131 million users, second only to China Mobile, China's top second mobile phone service companies.

China Unicom's total revenue in 2005 was $10 billion, net profit of $620 million. SK Telecom is only 20 million mobile phone users, but it is basically the total revenue of China unicom. China Unicom operates a GSM network and a CDMA network in the Chinese market. SK Telecom is the pioneer of global CDMA mobile technology, due to the lack of experience in the use of GSM mobile phone standard, it is difficult to carry out business in foreign markets.

SK Telecom CEO Shin BAE Kim said: the world's largest market with the world's best technology together, will mark the global CDMA market has entered a new era."

Convertible bonds can be converted into shares of the company after one year of purchase, when SK Telecom will control 6.67% of the shares of China unicom.

SK Telecom, a senior official said, after the Chinese government to release the telecommunications industry in the end of this year, foreign investment regulations, SK Telecom is keen to increase its share of the controlling stake in the China Telecom industry.

SK Telecom Company Seo senior vice president Jin woo said: "the SK telecom company intends to purchase China Unicom's convertible bonds, the most important reason is that both sides will take a 18 month strategic alliance, and it will become China Unicom only strategic alliance partners."

With China's accession to the WTO, foreign investment holdings will increase to 49% in December of this year. In a sense, SK Telecom will take advantage of the time to buy shares of China unicom.