A top executive of SK Telecom Co., South Korea's No. 1 mobile carrier, confirmed Thursday that it is seeking to take over U.S. telecom giant Sprint Nextel Corp., a local media report said Thursday.
SK Telecom Vice Chairman Cho Jung-nam told an Internet news provider E-Daily that the company has pushed for the purchase of Sprint Nextel, and is still contacting related companies for the purpose. "(The negotiations) are still underway," Cho was quoted
as saying.
Sprint Nextel is one of the largest telecom operators in the U.S. with around 53 million customers. Its market capitalization is estimated at US$64.1 billion, according to industry sources.
The confirmation comes weeks after SK Telecom denied a vernacular newspaper report on July 10 that it is in talks with private equity funds to buy the third-largest mobile service
provider in the U.S. At the time, its spokespersons called the report "groundless" and "based on rumors."
SK Telecom, which services more than half of South Korea's 40 million mobile service users, has been accelerating efforts to expand its presence in overseas markets to find new growth engines.
Last year, SK Telecom set up a strategic alliance with China Unicom Ltd., China's No. 2 mobile operator, by purchasing $1 billion worth of its convertible bonds. Also, in Vietnam, SK Telecom expects it will attract more than 3 million users by the end of this year.
However, the company has been struggling in the U.S. market as its joint venture "Helio" launched in May 2006 with local network operator EarthLink has failed to attract as many customers as it expected.
The Helio service provides mobile communications service to local people based on borrowed networks from Sprint Nextel. According to recent data, the service has attracted around 100,000 customers in the U.S. since its launch.