April 25, 2024

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SK Broadband, the wholly owned subsidiary of South Korea’s top mobile carrier, SK Telecom, requested approval to merge with No. 2 cable TV operator t-broad, the government said on May 9.

The Ministry of Science and ICT said it received a formal request to assess the business tie-up between the two companies.

If granted, approval could pave the way for SKT’s further expansion into the local media business.

The fixed broadband and cable TV firms earlier said they aim to complete the relevant process by the end of this year, with the merged entity to be launched in January 2020.

In the deal, estimated to be worth 4.7 trillion won ($4 billion), SK Broadband and t-broad, an affiliate of Taekwang Industrial, will be merged at a ratio of 3 to 1.

Once the tie-up is complete, SK Telecom will own 74.4 percent of the merged entity, with Taekwang’s stake standing at 16.8 percent.

Mirae Asset Daewoo, a major brokerage house, is set to invest 400 billion to own an 8 percent stake, according to the SK Broadband and t-broad.

Together with t-broad’s cable TV subscribers and SK Broadband’ IPTV users, the merged company is expected to have 8 million TV viewers, accounting for 23.8 percent of the country‘s pay TV market.

By Ram Garikipati and newswires (ram@heraldcorp.com)