Korea Telecom (KT) said it has acquired East Telecom, a Uzbekistan Internet service company, to start broadband and wireless Internet services in the Central Asian region.
The Korea’s largest fixed-line telephone and Internet company said that it purchased 51% of East Telecom shares at an undisclosed price. It also bought a 60% stake in Super-iMax, which has the right to use the radio frequency for the Mobile WiMax wireless Internet service in the former member of the Soviet Union.
"Uzbekistan’s communication infrastructure is underdeveloped but the corporate demand for high-speed Internet and mobile and fixed-line phone services is rapidly increasing," the company said in a statement. "Especially, Mobile WiMax has a large potential as there are around 60,000 Internet subscribers who use slow telephone connections."
KT’s domestic business has been stagnant for years as the fixed-line phone and Internet markets are saturated here. The company, however, began to see increasing profits in Russia’s Far Eastern region where it operates the telecom company NTC.
KT’s acquisition of East Telecom and Super-iMax are the first such actions by a Korean firm in Uzbekistan, which has a population of around 26 million. The annual revenue of East Telecom for this year is estimated at US$11 million, the firm said.
Earlier this month, KT celebrated the recognition of Mobile WiMax as the sixth standard third-generation mobile communication platform in an international forum in Geneva. The company, as well as several other Korean firms including Samsung Electronics and Posdata, has played a leading role in developing the technology. It is also participating in a consortium to get the Mobile WiMax business operated in Japan.
KT’s operating profit in the July-Sept. period amounted to 400.4 billion won, down 7.2% from 431.6 billion won a year earlier. Sales also declined 1.9% to 2.95 trillion won.