SK Telecom Co., South Korea's largest mobile phone operator, has agreed to buy a stake in Hana Financial Group Inc.'s credit card unit for $343 million to expand its wireless payment business.
SK Telecom said in a regulatory filing Monday that it plans to buy 57.6 million new shares in Hana Card Co. SK Telecom would hold 49% of the credit card company on completion of the deal, which is subject to approval by the nation's financial and antitrust regulators.
Hana Card, which aims to become one of the country's top three card companies in five years, would gain access to SK Telecom's more than 24 million customers.
SK Telecom would gain the ability to offer more mobile financial services. Revenue growth for wireless carriers is stagnant in South Korea, where more than 95% of people already own a mobile phone.
"This is a boost to Hana's weak card operation," said Lee Jin Woo, a fund manager at KTB Asset Management Co. in Seoul, which manages $8.6 billion of assets. "It provides a very good opportunity for Hana Card to attract faithful customers."
SK Telecom also has a joint venture with Citigroup Inc. called Mobile Money Ventures. Mobile Money, of San Francisco, is developing payments technology that Citi and other banks could offer through phones.