South Korea’s top telecom operator, SK Telecom, is looking at placing initial public offerings next year for its digital service subsidiaries.
The move is widely expected after the mobile carrier announced intentions of an IPO for its internet protocol TV operator SK Broadband and video streaming service operator Content Wavve.
“SK Broadband’s sales growth continues as the local pay TV market is increasingly centered around IPTVs,” said Jang Min-jun, an Analyst at Kiwoom Securities.
Recently, SK E&S announced its intentions to invest US$1.7 billion in setting up a data center in Saemangeum as part of a long term plan with SK Broadband to expand its digital presence in South Korea.
Among SK Telecom’s ICT subsidiaries, the first IPO candidate is likely to be Android app market unit ONE Store, which has an estimated value of US$855.1 million (1 trillion won).
Smart security firm ADT Caps is also predicted to subscribing an IPO due to an increased demand for unmanned systems. In 2018, SK Telecom paid US$603.8 million (702 billion won) for a 55% stake in Siren Holdings Korea, which owns 100% of ADT Caps.
Analysts expect the IPOs to accelerate SK Telecom’s goal to move beyond its telecommunications realm and become a tech giant.
“The IPOs could lead SK Telecom’s transition to an ICT holding company from just a network service provider,” said Choi Nam-kon, an analyst at Yuanta Securities Korea, said in a report by The Korea Herald.
SK Telecom is considering dropping ‘Telecom’ from its name to shift away from its network-focused business and branch out into the wider digital space, according to the company’s CEO, Jung-Ho Park.
Image Credit: Pierre Metivier