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Friday, 2 November, 2001, 11:55 GMT
South Korea delays telecoms sell-off
DoCoMo employees looking at 3G phone
Korea Telecom is selling shares in mobile firm SK Telecom
The South Korean government has been forced to delay privatising the country's biggest fixed line phone operator, Korea Telecom, because it cannot get a good price for its stake.

In July, information minister Yang Seung-taik said the government had been holding talks with a number of foreign firms, including Microsoft.

The sell-off is now pencilled in for the end of 2002, six months later than originally planned, according to Korea Telecom's chief financial officer, Nam Joong-soo.

"We have no desire to conduct a fire sale to complete the privatisation... I personally think we can complete privatisation by the end of next year," he said.

Tight time-frame

Talks are taking place with potential foreign partners and should be sucessfully concluded by the end of this year, he said.

Analysts expressed scepticism over whether the firm and the government, which owns 40.1% of the Korea Telecom, would be able to meet this deadline.

"It has only two months to find the right guys. But things overseas will not be that favourable," said Hanwha Securities analyst.

Korea Telecom also plans to buy back some of its own shares, which have lost 27% of their value this year, to ease market concerns about a glut, Mr Nam said. .

Mobile shares

Analysts have been expecting the phone firm to fund a buy-back by selling part of its 13.4% holding in domestic mobile phone giant SK Telecom, trimming the stake to 10.4%.

Their expectations were confirmed by news that SK Telecom paid Korea Telecom 668bn won ($515bn) for 2.67 million of its own shares, equivalent to 3% of the mobile firm.

SK Telecom last month announced a delay to its own development plans, postponing the launch of third-generation services till 2003.

See also:

12 Oct 01 | Business
SK Telecom says DoCoMo talks go on
23 Aug 01 | Business
Cheaper calls for North Korea
01 Oct 01 | Business
First 3G mobiles launched in Japan
03 Sep 01 | Business
NTT DoCoMo unveils 3G package
24 Aug 01 | Business
NTT DoCoMo in European tie-up
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