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Press Release
A total of about KRW200 billion in funds was applied for the consortium. This amount is more than twice the amount set by the company for the consortium’s initial capital.
The ownership stakes in the satellite DMB company will consist of 30% held by SK Telecom, 30% owned by strategically affiliated companies, 10% by affiliated foreign companies, 11% by business collaboration companies, and 11% by other general investors. Eight percent will be reserved as treasury stock in the new satellite DMB company.
SK Telecom plans to officially launch a new satellite DMB company by mid-December with an initial capitalization of KRW130 billion.
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Satellite DMB service allows subscribers to access all multimedia broadcast channels at any time and anywhere via special receivers in mobile handsets and automobiles.
On November 6th, SK Telecom announced that the company has formed a consortium to offer a satellite digital multimedia broadcasting (DMB) service.
SK Telecom closed the applications for participation in the consortium on the 31st of October. About KRW200 billion was applied for the consortium. This amount is more than twice the initial capital set by the company for the consortium. In this expanded application, SK Telecom extended the initial capital amounting to KRW100 billion to KRW130 billion, and announced the equity share of each participant.
As a result, an SK Telecom official revealed that the company will take part in the satellite DMB company as a major shareholder with a 30 percent stake. Equipment manufacturers and broadcast channel providers, will hold about 30% (about 5% for each company). In addition, affiliated foreign companies, and business collaboration companies like base-station manufacturers and distribution companies, will have 10% and 11% respectively. Other general investors will take 11%, and the satellite DMB company’s treasury stock held by its employees will be about 8%.
A total of 200 companies will become consortium members. They will consist of handset and equipment manufacturers (such as LG Electronics, and Pentec & Curitel), broadcast channel providers (such as MBN, CJ Media, and On-Media), base-station manufacturers, infrastructure builders, and Japan’s MBCO.
There will also be service distribution companies, financial companies (such as Hana Bank), and venture capitalists (such as KTB and STIC), participating in the consortium.
With respect to the regional private broadcasters, SK Telecom has set aside a specific portion of equity shares for broadcasting companies who have not yet decided to participate in the consortium due to the early closing of the application date. This will encourage them to take part in the consortium as soon as possible.
In the case of KT, the allocation of equity shares is excluded. However, if KT decides to participate in the consortium without further delay, its participation will be accepted. In this case, the allocation of other stakes will inevitably be re-adjusted. An SK Telecom official revealed that the company has already determined that the other participants’ understand this matter.
SK Telecom said in the resolution from its Board of Directors on the 5th of this month, it will set up a new satellite DMB company by the end of this month, with an initial capital contribution of KRW32.5 billion. Further, the company plans to raise KRW130 billion for the new company by mid-December.
Jun Dong Bae, vice-president of SK Telecom’s PMSB Business Group, commented "SK Telecom has successfully formed a consortium and secured a frequency and satellite for the satellite DMB business. When the satellite is launched by the beginning of 2004, the preparations for the service will be completed. Such issues as the revisions in the Broadcast Law, and satellite DMB business license are pending. We expect that these will be resolved soon," he added.
He also revealed that it will achieve BEP by 2006, and accumulated BEP by 2008. Therefore, the shareholding companies should realize investment profits at a relatively early stage.
Satellite DMB is a new service that will allow subscribers to access all multimedia broadcast channels at any time and anywhere via special receivers in mobile handsets and automobiles.
SK Telecom closed the applications for participation in the consortium on the 31st of October. About KRW200 billion was applied for the consortium. This amount is more than twice the initial capital set by the company for the consortium. In this expanded application, SK Telecom extended the initial capital amounting to KRW100 billion to KRW130 billion, and announced the equity share of each participant.
As a result, an SK Telecom official revealed that the company will take part in the satellite DMB company as a major shareholder with a 30 percent stake. Equipment manufacturers and broadcast channel providers, will hold about 30% (about 5% for each company). In addition, affiliated foreign companies, and business collaboration companies like base-station manufacturers and distribution companies, will have 10% and 11% respectively. Other general investors will take 11%, and the satellite DMB company’s treasury stock held by its employees will be about 8%.
A total of 200 companies will become consortium members. They will consist of handset and equipment manufacturers (such as LG Electronics, and Pentec & Curitel), broadcast channel providers (such as MBN, CJ Media, and On-Media), base-station manufacturers, infrastructure builders, and Japan’s MBCO.
There will also be service distribution companies, financial companies (such as Hana Bank), and venture capitalists (such as KTB and STIC), participating in the consortium.
With respect to the regional private broadcasters, SK Telecom has set aside a specific portion of equity shares for broadcasting companies who have not yet decided to participate in the consortium due to the early closing of the application date. This will encourage them to take part in the consortium as soon as possible.
In the case of KT, the allocation of equity shares is excluded. However, if KT decides to participate in the consortium without further delay, its participation will be accepted. In this case, the allocation of other stakes will inevitably be re-adjusted. An SK Telecom official revealed that the company has already determined that the other participants’ understand this matter.
SK Telecom said in the resolution from its Board of Directors on the 5th of this month, it will set up a new satellite DMB company by the end of this month, with an initial capital contribution of KRW32.5 billion. Further, the company plans to raise KRW130 billion for the new company by mid-December.
Jun Dong Bae, vice-president of SK Telecom’s PMSB Business Group, commented "SK Telecom has successfully formed a consortium and secured a frequency and satellite for the satellite DMB business. When the satellite is launched by the beginning of 2004, the preparations for the service will be completed. Such issues as the revisions in the Broadcast Law, and satellite DMB business license are pending. We expect that these will be resolved soon," he added.
He also revealed that it will achieve BEP by 2006, and accumulated BEP by 2008. Therefore, the shareholding companies should realize investment profits at a relatively early stage.
Satellite DMB is a new service that will allow subscribers to access all multimedia broadcast channels at any time and anywhere via special receivers in mobile handsets and automobiles.