Why would Verizon want CDMA2000 in Korea?
Korea's Hanaro holds 3G talks with Verizon
By Nam In-soo, Reuters
02 February 2001
South Korea's Hanaro Telecom Inc said on Friday it was seeking investment from Verizon Wireless, America's largest mobile telephone company, in its consortium bidding for a third-generation (3G) mobile phone licence.
"We are in talks with the U.S. mobile company for an equity investment," Rhee Jong-myung, executive vice president of Hanaro Telecom, told Reuters in a telephone interview.
"We expect it to inform us about its intention and if it does, how much it plans to invest, by early next week."
Verizon Wireless is a joint venture of Vodafone Group Plc and Verizon Communications, the leading U.S. local telephone company.
Hanaro led a consortium that was rejected in bidding for 3G licences in mid-December, but the government plans to offer one more licence, which will use Qualcomm's cdma2000 format, in March.
Hanaro said it would bid again.
Rhee said he had discussed the equity investment with senior officials of Verizon Wireless in the United States last week.
"We did not specifically discuss how much Verizon could invest in our consortium. The amount may be smaller than had been reported in local media."
Local media reports had said Verizon was eyeing a stake of 20 to 30 percent in the consortium.
"I hope foreign companies would take up a combined 40 percent stake in the consortium," Rhee said.
Hanaro said the company itself would represent 10 percent of the group.
Shares of Hanaro finished up 70 won at 3,760 on Friday.
FOREIGN ALLIANCE
Hanaro has been actively seeking alliances with foreign telecom companies to raise its chances of winning a licence to be awarded in March for 3G, which offers quality video and high-speed data services.
U.S. wireless technology provider Qualcomm Inc said in January it was willing to join Korean telecom firms in a bid for a 3G licence.
"Qualcomm is ready to partner with Korean firms in bidding for 3G services, which includes equity participation if they want," Park Moon-suh, director at Qualcomm Korea Ltd, said at the time.
Qualcomm signed a memorandum of understanding (MOU) with Hanaro on 3G technology assistance in December.
Rhee said it had also conveyed the consortium's 3G business plans to Qualcomm and expected it to express its view on possible participation in the group next week.
In December, Hanaro also signed an MOU with U.S. private equity firm WL Ross for a $100 million investment in the Korean firm on condition its consortium won a 3G licence.
Ahn Byung-yub, Minister of Information and Communication, said on Thursday the Hanaro group could be selected as a 3G service provider if it was equipped with further financial and technical abilities.
"If any leading company, whether it be Hanaro or LG Telecom, wants to form a grand consortium for the cdma2000 licence, the government could help," Ahn told reporters.
More than half of South Korea's 46 million people use mobile phones based on cdma2000 technology.
The country pioneered the commercial application of cdma2000 technology and has the largest number of mobile phone users with that technology in the world. |
