Telecom giants’ payouts surge

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Telecom giants’ payouts surge

KT Corp. and SK Telecom Co., Korea’s top two telecommunications companies, spent a combined 1.62 trillion won ($1.57 billion) on dividend payments to foreign shareholders between 2000 and 2004, a government report said yesterday. At the current pace, 2005 dividend payments to foreign shareholders by the companies will likely total 900 billion won, according to the report, which was submitted to the National Assembly by governing Uri Party lawmaker Seo Hye-seok. In contrast, facility investment by KT dropped 34.8 percent to 2.2 trillion won in 2004 from 3.4 trillion won in 2000, while SK Telecom’s spending fell to 1.6 trillion won last year from 1.8 trillion won in 2000, the report by the Ministry of Information and Communication showed. Foreign shareholders own 48.96 percent of KT stock and 47.88 percent of SK Telecom. They are barred from holding more than a 49-percent stake in Korea’s major telecom companies. The surge in dividend payments to foreign shareholders is a key reason why KT and SK Telecom have invested less in facilities, Mr. Seo claimed.
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