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SKT makes bid for Hynix

SK Telecom submitted its application to take over Hynix Semiconductor, owned by creditors, as a sole bidder on Thursday.

Credit Suisse, one of the co-sale brokers for the deal, received the bid to acquire a 15 percent stake in Hynix from SKT, said officials at Korea Exchange Bank, the main creditor.

SKT tendered the last minute application just before the 5:00 p.m. deadline after hours of heated in-house debate over whether to bid amid turmoil following the prosecution’s probe of the SK Group chairman.

After STX Group dropped out of the M&A competition in September Credit Suisse has tried to tap other investors’ intention on whether they are interested in joining the takeover process for the world’s No. 2 memory chipmaker but to no positive response.

In a bid to promote competition, creditors extended the deadline for the final bidding by a week to Nov. 10, in the hope that other buyers would emerge to vie with SK Telecom. But they failed to find additional bidders.

In July, STX Group, a Korean shipping and shipbuilding conglomerate, and SK Telecom submitted letters of intent to purchase the stake in the chipmaker, with an estimated value of about 3 trillion won ($2.6 billion), and did seven weeks of due diligence.

The sale hit a snag as STX pulled out of the bidding due to global uncertainty and the huge investment burden, leaving SKT as the sole bidder for the controlling stake.

In a statement, STX said that its bidding plans were scrapped due to global economic instability and fears that the large investment required to strengthen Hynix’s operations could weigh the group down.

This is not the first time Hynix creditors have made attempts to sell their shares of the chipmaker. Creditors tried to make a sale to a U.S.-based company in 2002, but plans were scrapped.

Then Hynix was put up for sale again in 2009, with the plan falling apart over concerns that the sole bidder Hyosung Group was given preferential treatment.

The sale of Hynix is projected to be finalized by early next year under conditions that the price negotiation is carried out smoothly.

By Kim Yon-se