South Korea’s number one operator SK Telecom is to acquire a KRW3.427 trillion (US$3.05 billion) stake in Hynix Semiconductor, reports Dow Jones Newswires. SK Telecom said it will buy 101.85 million new Hynix shares at KRW23,000 each, a 14.7 percent stake. It will also buy 44.25 million existing shares held by creditors for KRW24,500 each, a 6.4 percent stake, taking its total stake to 21.1 percent. Bloomberg reports the offer represents a premium of 3.1 percent compared to the closing price of Hynix stock on Monday.
The deal will allow nine creditor banks to offload some of the 15 percent holding they have in the world’s second-largest maker of memory chips after Samsung. The creditors became shareholders in Hynix after several debt-for-equity deals in the years following the near collapse of the company in 2001, due to an industry downturn.
The acquisiton will also allow SK Telecom to diversify into new areas and have a stake in a company that makes major components for smartphones and tablet computers. However, substantial expenditure will be needed to keep the production lines at Hynix up to date, which combined with SK Telecom’s increasing network investment, could put a financial strain on the company. According to Dow Jones Newswires the company had KRW2.76 trillion in cash at the end of September.
Mobile Business Briefing last week reported that SK Telecom was the only party to lodge a bid to buy a controlling stake in Hynix by a deadline set by Hynix’s main shareholders, led by the Korea Exchange Bank.
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