SEOUL -(Dow Jones)- SK Telecom Co. (SKM), South Korea's largest wireless operator, said late Tuesday it will sell a 60% stake in its handset manufacturing unit SK Teletech to Pantech & Curitel Communications Inc. (063350.SE) for KRW300 billion.
In a filing to the Financial Supervisory Service, SK Telecom said it will sell 4.5 million shares in SK Teletech at KRW66,050 each.
SK Telecom currently holds 89.1% of the unit. It said it plans to hold the remaining 29.1%.
"The transaction is part of a major global strategic alliance between Pantech & Curitel and SK Telecom," Pantech & Curitel said in a separate statement issued later Tuesday.
Pantech & Curitel said it plans to retain management control of SK Teletech, but SK Telecom will maintain its remaining stake in the mobile handset company for at least the next four years "to reserve certain management rights."
SK Telecom plans to complete the transfer of shares within the first half of this year.
The two companies also agreed to collaborate in joint research and development projects and work to expand their operations overseas, especially in the U.S.
"The alliance will allow us to have a combined manufacturing capacity of 20.9 million handsets annually, strengthening our global competitiveness," SK Telecom said in a statement.
The two companies also plan to collaborate to develop mobile handsets for SK Telecom's joint venture with U.S.-based Earthlink Inc. (ELNK).
Earlier this year, SK Telecom signed an agreement with Earthlink to form a joint venture to market wireless voice and data services in the U.S. The venture, capitalized at $440 million, is called SK-EarthLink.
Pantech & Curitel is South Korea's third-largest mobile handset maker behind Samsung Electronics Co. (005930.SE) and LG Electronics Inc. (066570.SE).
-By Yun-Hee Kim, Dow Jones Newswires; 822-732-2165; yun-hee.kim@dowjones.com
-Edited by Alastair Gale
(END) Dow Jones Newswires"
Posted to the site on 3rd May 2005
Posted to: www.cellular-news.com/story/12739.php