SK Telecom will “buy as much as $1 billion of bonds convertible into a 6.7 percent stake in China Unicom…The three-year bonds will be convertible into as many as 899.7 million China Unicom shares, SK Telecom said in a regulatory filing in Seoul. The South Korean company said it plans to buy the bonds on July 5. The bonds will initially be converted into shares at HK$8.63 apiece.” However, SK Telecom will have to wait for a year after the purchase before converting the bonds into shares.
The move gives SK Telecom room to grow (since the Sth Korean market is pretty much saturated) and China Unicom a partner with a lot of experience in advanced mobile technology — including 3G networks, if the Chinese government ever gets around to issuing license.
Bloomberg notes DoCoMo and Vodafone also intend to get in on the Chinese act in a similar way to SK Telecom.
Rumors of the investment surfaced earlier this month and were supported by analysts, but SK Telecom denied the deal.
Related stories:
–Warner Music In China Wireless Venture
–MSN Ties With China Unicom For Mobile MSN
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