KT shareholders OK merger with mobile phone unit KTF

SEOUL, March 27 (Yonhap) -- Shareholders of KT Corp., South Korea's top
fixed-line and broadband Internet operator, approved Friday the company's merger
with KTF Co., its mobile subsidiary.
The approval comes about 12 years after KTF, the country's second largest mobile
carrier, was founded in January 1997.
Market watchers say the merger will make KT a telecom powerhouse in fixed-line
and wireless services, enabling it to better compete with SK Telecom Co., the
nation's largest mobile phone company.
The merged entity will be launched on May 18, KT said earlier. Under the proposed
terms of the merger, KT will offer 0.719 of its stock for each KTF share.
The transaction will create a company with annual sales of about 19 trillion won
(US$13.3 billion), a total asset value of 23.6 trillion won and some 38,000
employees, according to KT.
Last week, KT won final regulatory approval from the nation's telecom regulator,
the Korea Communications Commission.
KT, a former state-run company, controls more than 90 percent of South Korea's
wired telephone market and services nearly 45 percent of broadband Internet
users. KTF holds a nearly 30 percent share of the mobile phone market, compared
with SK Telecom's 50 percent.
As the nation's telecom market becomes increasingly saturated, companies are
trying to promote combined fixed and mobile services to cut costs and woo
customers from rivals.
ygkim@yna.co.kr
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