2 S. Korea firms bid for Hynix stake

Two South Korean companies said Friday they had submitted preliminary bids to buy a controlling stake in Hynix Semiconductor, the world's second-largest memory chip maker. Top mobile carrier SK Telecom and shipbuilder STX Group sent letters of intent to creditors-turned-shareholders to buy a 15 percent stake before the deadline Friday afternoon. The creditors want to select a preferred bidder in August and complete the sale of their combined stake worth 2.4 trillion won ($2.3 billion) by the end of the year. SK Telecom said convergence of the chipmaking and telecommunications businesses would enhance efficiency and help expand its overseas interests. "The semiconductor business will help us become a global company," it said, adding demand for memory chips was likely to continue growing due to the spread of smartphones, tablet PCs and smart TVs. SK Telecom controls about half of South Korea's saturated mobile market. STX said it aims to diversify from shipbuilding and shipping, adding that it is considering setting up a consortium with an unidentified sovereign wealth fund in the Middle East to buy Hynix. Ship making giant Hyundai Heavy Industries, once viewed as the sole likely candidate to buy Hynix, said Thursday it was not interested -- raising fears a sale would fall through again. The creditors rescued Hynix by swapping their debt holdings into shares in 2001 and 2002. They have been trying for years to sell out but previous attempts have been dogged by uncertainties over the chipmaking sector and the need for huge investment in Hynix. Korea Exchange Bank is the biggest shareholder with a 3.42 percent stake, followed by Woori Bank with 3.34 percent, state policy lender Korea Finance Corp with 2.58 and smaller stakeholders. The chief of Korea Finance Corp said in late March that creditors are considering issuing new shares, a move that would bolster the chip maker's financial strength and ease the need for extra investment. Hynix's first-quarter net profit slumped 66 percent year-on-year because of falling computer memory chip prices.