Hyundai Group said Monday that it has decided to withdraw bid to participate in the competition to select the country’s fourth telecom project.

Hyundai Group’s affiliate Hyundai Ubiquitous and Information Technology said it is withdrawing from the IST consortium, indicating it will take out its investment sum of 35 billion won ($30.4 million).

“We were planning to inject about 35 billion won because we believed the fourth telecom project was a promising one for future growth and a plus for the country’s economy, but we came to this conclusion due to many complicating issues existing within the consortium,” said a company official.

Hyundai Securities, another Hyundai affiliate involved in the consortium, which was planning to invest 145 billion won in the project, will also follow suit, according to industry sources.

Hyundai Group was reportedly planning to grab the No. 2 stakeholder spot in IST by having its two affiliates ― Hyundai U&I and Hyundai Securities ― invest 180 billion won in the consortium.

However, Hyundai Group seems to have changed its mind as a financial firm from the Middle East unveiled its plan to offer 200 billion won in investment to become the second stakeholder.

Earlier last month, Hyundai announced it would invest in IST as it secured 703.8 billion won in paid-in capital along with the consortium’s largest stakeholder SB Mobile, as well as small and mid-sized firms. Samsung Electronics, Curious Inc. and Middle Eastern financial institutions were also among the investors.

IST had planned to increase its paid-in capital to 750 billion won, with it expecting to release government-issued stocks on two different occasions.

The move prepared the groundwork for IST to compete with KMI, a group which won financial support from Dongbu Group in its third attempt to become the nation’s fourth telecom.

KMI had already failed twice in getting state approval because it was unable to collect the necessary funding and win the government’s trust.

For the past 10 years, Korea’s telecom market has been dominated by three players ― SK Telecom, KT Corp. and LG Uplus.

By Cho Ji-hyun (sharon@heraldcorp.com)