Powercomm Rescheduled By Seoul for Privatization

The Ministry of Information and Communication said Tuesday the privatization of Powercomm has been delayed until the end of 2001.

The government and Korea Electric Power had planned to sell a 66 percent stake in Powercomm, a provider of leased-line and cable TV network services, by the end of 2000 and the remaining stake by the end of 2001. A 10.5 percent stake in the company was sold to local firms, including SK Telecom Co. and Pohang Iron & Steel Co., last year. Korea Electric Power currently holds 89.5 percent of Powercomm.

The government originally planned to sell a 30 percent stake in Powercomm to local telecommunication operators in April through an auction. But the plan failed.

The ministry said that it will allow any company, foreign or domestic, to take a 30 percent stake in Powercomm.

The move has opened the way for a nontelecommunication company or an overseas equity fund to become the firm's biggest shareholder.

"Investment by local telecom operators is either restricted by the legal ceiling on their equity holding in other firms or fund shortages," a ministry official explained.

The ministry said that it had decided to complete Powercomm's privatization by the end of next year and will set a fixed timetable for the process after consultations with the Ministry of Planning and Budget and the Ministry of Commerce, Industry and Energy.

by Choi Ji-young