South Korea's Pantech considers buying loss-making Siemens handset operations
By MarketWatch
Last Update: 5:12 AM ET May 6, 2005
SEOUL (MarketWatch) -- Pantech Co. (025930.SE) is considering the purchase of Siemens AG's (SI) unprofitable mobile handset operations, a company executive confirmed Friday.
"We are reviewing such plans, although everything is in a preliminary stage so nothing has been decided," said the executive, who declined to be named.
The executive declined to comment further.
The comments came after local newspaper Korea Economic Daily reported Pantech affiliates have recently received a request from Siemens to purchase its mobile phone business.
If Pantech acquires Siemens, it will be able to garner the world's fourth position in the cellphone market, replacing LG Electronics Inc. and Sony Ericsson, a venture of Telefon AB LM Ericsson and Sony Corp., the daily said.
Siemens said earlier this week that it remains in talks with potential partners for its mobile phone unit.
"We are talking with several companies," a spokesman for Siemens said.
Siemens has struggled to come up a solution for the handset division, which had a loss of EUR138 million in the quarter ending March 31 after sales of mobile phones fell 27% to 9.3 million.
Pantech affiliate Pantech & Curitel Communications Inc. earlier this week agreed to purchase a 60% stake in the handset manufacturing unit of South Korea's largest wireless operator SK Telecom Co. for KRW300 billion in a move to expand globally.
Pantech is South Korea's third-largest handset manufacturer behind Samsung Electronics Co. and LG Electronics.
The news boosted Pantech shares. At 0043 GMT, the stock was up 4.2% at KRW5,680, outperforming the broader market which rose 0.9%.
(Rolf Neumann in Munich contributed to this story.)
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