Hyundai HCN to Select Preferred Negotiator on 24th... Skylife and SKT in 'Two-Way Battle'

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[Asia Economy Reporter Koo Chae-eun] It has been confirmed that Hyundai HCN plans to select and notify the preferred negotiation partner on the 24th.

According to industry sources on the 13th, Credit Suisse (CS), the sales agent for Hyundai HCN, informed potential buyers of their intention to select the preferred negotiation partner on the 24th. The schedule is to conduct the main bidding on the 15th, select the preferred negotiation partner around the 24th, provide an opportunity for due diligence, and finalize the sale after price negotiations. Hyundai Department Store Group plans to complete the sale within the first quarter of next year.

Hyundai HCN plans to comprehensively review evaluations based on pre-established criteria for selecting the preferred negotiation partner and whether the final bidding proposals meet the restricted requirements, and then announce the final preferred negotiation partner.

All three major telecom companies participated in the preliminary bidding, but the market highly anticipates that the M&A competition after the main bidding will likely be a two-way battle between SK Telecom and KT Skylife. Although LG Uplus entered the preliminary bidding, it lacks sufficient funds after acquiring the industry leader HelloVision. KT Skylife is aggressively pursuing independent survival amid a decline in subscribers in its main business area, satellite broadcasting. SK Telecom, which ranks third in the paid broadcasting market among the three telecom companies, also has a strong incentive to acquire in order to improve its ranking.

Hyundai HCN recorded an operating profit of 70 billion KRW last year, and its debt ratio is 9.44%, which is lower compared to competitors, making it an attractive "prime" asset compared to D'Live and CMB. It also holds eight prime business areas in major cities such as Seocho-gu and Dongjak-gu in Seoul, Busan, and Daegu.

Whoever acquires Hyundai HCN is expected to cause a significant shift in the paid broadcasting market share rankings among the three telecom companies. The current paid broadcasting market shares are ▲KT (including KT Skylife) 31.31% ▲LG Uplus (including LG HelloVision) 24.72% ▲SK Broadband (including T-Broad) 24.03% ▲D'Live 6.1% ▲CMB 4.7% ▲Hyundai HCN 4.1%.