Korea Thrunet Purchases Nowcom
SEOUL, South Korea, and NEW YORK, Jan. 14 /PRNewswire/ --
Korea Thrunet Co., Ltd. (Nasdaq: KOREA - news) today announced that the Company purchased equity ownership in one of the leading Korean online service providers, Nowcom Company Limited, from Hanchang Corporation. In this deal, Korea Thrunet led a group of investors consisting of TriGem Computers Inc., TriGem Ventures and Metaland Inc. The Thrunet-led group acquired a 61.2% ownership stake in Nowcom. Co., Ltd. investing KRW 68 billion or US $59 million.
Through this purchase, Korea Thrunet acquired 32% of equity ownership of Nowcom Co., Ltd. for KRW 35.6 billion or US$ 31 million and has become the largest shareholder. TriGem Computers, TriGem Ventures and Metaland will own 10.0%, 17.5% and 1.7% respectively.
Nowcom Co., Ltd. is also widely known under the brand name of ``Nownuri' in Korea. Since the inception of the Company in 1994, it has been providing on- line service, Internet and systems integration services. It is the 4th largest Korean narrowband Internet portal and on-line access service provider in terms of number of subscribers. There are 1.49 million users registered at ``Nownuri.'
``We are a premier on-line service provider in Korea. We have over 3,200 cyber communities, which have enabled us to effectively expand our presence in this rapidly growing market,' said Mr. Chang Hoon Kang President & CEO of Nowcom Co., Ltd. ``Until now, our business has been limited to the narrowband market, but with Korea Thrunet we can expand our services to the broadband market. I believe the acquisition by Korea Thrunet will create huge synergy between the two companies in both access and portal enhancement strategy.'
The Nowcom's ``Nownuri' has attracted younger users with its portal services. Approximately 70% of its users are young students and people in their 20's.
``Our primary strength is in broadband access, multimedia content and broadband portal service, but we are still in an early development stage in the narrowband market segment. At present in Korea, over 90% of Internet users still use narrowband access service, and I believe subscribers in the narrowband market will continue to grow, although at a lower rate than that of broadband. Therefore, the purchase of a leading narrowband access and portal service provider such as Nownuri would be a huge plus for us,' said Mr. Jong Kil Kim, President and CEO of Korea Thrunet. ``We need to work on migrating those narrowband users into our broadband services, and 'Nownuri' will play a key role for us in increasing traffic and broadening our subscriber base. With a broader subscriber base, we can expect faster growth in generating advertising and e-commerce revenues,' said Mr. Kim.
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