STX, SK Telecom offer preliminary bids for Hynix

(ATTN: UPDATES with share prices, remarks and more info in paras 8-12,15-17)
SEOUL, July 8 (Yonhap) -- South Korean shipbuilding giant STX Group and top mobile carrier SK Telecom Co. said Friday they submitted preliminary bids to buy a major stake in Hynix Semiconductor Inc. worth at least 2.4 trillion won (US$2.3 billion).
Creditors of Hynix are seeking to unload their 15 percent stake in the world's second-largest computer memory chip maker. They finished receiving letters of intent from prospective buyers at 4 p.m.
STX Group, the 12th-largest conglomerate in South Korea, said its move to buy the chipmaker aims to diversify its business portfolio, which largely focuses on shipbuilding and shipping.
The group also said it is considering setting up a consortium with a sovereign wealth fund in the Middle East in a bid to purchase Hynix.
SK Telecom said its participation in the race to take over Hynix is designed to find new opportunities for overseas expansion and to seek business synergy by converging chipmaking and telecommunications businesses.
"Semiconductor business will enable us to become a global company because it is expected to continue to grow thanks to the spread of smartphones, tablet PCs and smart TVs," the company said in a statement.
SK Telecom controls about half of South Korea's mobile market, where players have difficulty finding room for expansion due to cutthroat competition and a high penetration rate.
Shares of Hynix Semiconductor added 0.76 percent to close at 26,600 won on the main bourse. SK Telecom fell 3.24 percent to 149,500 won while STX Group rose 0.72 percent to 20,950 won.
"SK Telecom's move to buy the chipmaker is likely to have limited business synergy between the chipmaking and mobile business. In the short term, share prices of SK Telecom would be under pressure due to high risks of the potential takeover," said Choi Yoon-mi, an analyst at Mirae Asset Securities Co.
Park Min, an analyst at Korea Investment & Securities, said that it remains to be seen how STX Group would finance the deal, but without additional borrowing, the group may fund the deal by selling its assets.
Creditors led by Korea Exchange Bank (KEB) said they will closely look into the two bidders' capability to finance the deal in a bid to prevent a potential buyer from suffering from heavy financial burdens.
They are seeking to select a preferred bidder for Hynix Semiconductor in August and to complete the sale by the end of this year.
The process to sell Hynix Semiconductor took a new twist last week as Hyundai Heavy Industries, once viewed as a strong candidate to buy the company, decided not to bid for the chipmaker, raising fears that creditors may again fail to sell it. Industry groups -- LG Group, Hyosung Group and Dongbu Group -- said earlier that they did not consider making a bid for the stake.
The creditors' previous attempts to sell Hynix Semiconductor have been thwarted twice as volatile business conditions for the chipmaking sector and huge investments have made potential investors wary of buying the company.
In February, the creditors failed to attract any bidders. In November 2009, Hyosung Corp., the sole bidder in the first sale attempt, dropped its bid for the stake on market speculation that it received political favors to pursue the takeover.
To facilitate the sale of Hynix, the chief of policy lender Korea Finance Corp. the third-largest creditor, said creditors are considering issuing new shares, a move to help the chipmaker bolster its financial strength and ease burdens of additional capital investment for a new owner.
The creditors injected $4.6 billion to rescue the chipmaker by swapping their debt holdings into shares in 2001 and 2002.