DoCoMo to take 10% stake in KT Freetel

21 Dec 2005

Japan’s largest mobile operator NTT DoCoMo is to pay USD560 million for a 10% stake in South Korean counterpart KT Freetel (KTF). The deal, the largest overseas investment by a Japanese firm since 2001, will be made through the allocation of new shares and the acquisition of KTF treasury stock and is expected to be completed by the end of this year. The strategic tie-up between the two cellcos is designed to help speed up the proliferation of W-CDMA technology, pioneered by DoCoMo. KTF, which controls more than 30% of the Korean mobile market, has made it clear that its strategy is focused on developing W-CDMA.

In a separate development, NTT DoCoMo has said it is looking to buy a 2.6% stake in Fuji Television network for USD177 million to consolidate its relationship with the broadcaster ahead of the planned launch of digital TV services on its mobile phones. The two firms are cooperating on digital content and hope to start offering digital TV programmes to cellphones by 1 April 2006. DoCoMo is under pressure to boost its revenues in a saturated 2G market that is set to get even more competitive next year when the Japanese government implements mobile number portability (MNP).

Japan, South Korea, NTT DOCOMO