Shareholders OK merger of LG Group's 3 telecom units

SEOUL, Nov. 27 (Yonhap) -- Shareholders of LG Group's three telecom affiliates
approved Friday a merger of the companies next year to better compete with two
local telecom powerhouses.

A majority of shareholders of the three -- mobile carrier LG Telecom Ltd.,
fixed-line operator LG Dacom Corp. and broadband Internet service provider LG
Powercom Corp. -- voted earlier in the day to allow LG Telecom to absorb the
other two companies as of Jan. 1, 2010.
LG Group, one of South Korea's leading family-run conglomerates, filed an
application last month with the South Korean telecommunication's regulator for
permission for the move. The Korea Communications Commission will make the final
decision by mid-December.
LG Telecom, the smallest mobile carrier in the market, competing with bigger
rivals SK Telecom Co. and KT Corp., announced the merger plan last month. It said
the move would help draw more subscribers as it would allow the company to
provide fixed-line and mobile package services.
South Korea's telecom industry is keen to develop services that bundle up
fixed-line, wireless Internet, mobile and broadband access as companies compete
for more subscribers in the country's saturated market. Market watchers expect
the introduction of wireless-fidelity (Wi-Fi) mobile devices to further
accelerate the drive toward convergence services.
Once the merger goes through, the new LG Telecom is expected to become the third
South Korean telecom giant with annual sales of more than 7.72 trillion won
(US$6.65 billion) and an operating profit of over 690 billion won.
ygkim@yna.co.kr
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