1934 Act Registration No. 1-14418
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE MONTH OF DECEMBER 2002
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SK TELECOM CO., LTD.
(Translation of registrant's name into English)
99, Seorin-dong
Jongro-gu
Seoul, Korea
(Address of principal executive offices)
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(Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.)
Form 20-F [X] Form 40-F [ ]
(Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes [ ] No [X]
(If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b):82- .)
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This report on Form 6-K shall be deemed to be incorporated by reference in
the prospectus included in Registration Statements on Form F-3 (File No.
333-14102, 333-91034 and 333-99073) filed with the Securities and Exchange
Commission and to be a part thereof from the date on which this report is filed,
to the extent not superseded by documents or reports subsequently filed or
furnished.
SHARE REPURCHASE FROM KT CORPORATION BY THE COMPANY AND THE SALE BY THE
COMPANY TO KT CORPORATION OF KT CORPORATION COMMON SHARES.
SK Telecom Co., Ltd. (the "Company") announced on December 20, 2002 that
its board of directors approved the Company's plan to make an application to the
Korean Financial Supervisory Service (the "FSS") for the approval of the
repurchase of the Company's shares from KT Corporation and the sale by the
Company to KT Corporation of common shares of KT Corporation owned by the
Company in two steps, meant to eliminate all cross-holdings between the Company
and KT Corporation. Although the regulation allowing such exchange came into
effect on December 18, 2002, the Company must still obtain approval from the FSS
to execute the exchange. Such application was made to the FSS on December 20,
2002.
The application states that the Company shall purchase from KT Corporation
8,266,923 of the Company's shares (which represents approximately 9.27% of the
total issued and outstanding stock of the Company as of December 20, 2002 and
all of the Company's shares owned by KT Corporation) and that KT Corporation
shall purchase from the Company 29,808,333 common shares of KT Corporation
(which represents approximately 9.64% of the total issued and outstanding stock
of KT Corporation as of December 20, 2002 and all of the common shares of KT
Corporation that the Company owns). The transaction is expected to be conducted
at an agreed per share price of KRW 50,900 for each share of KT Corporation
owned by the Company (total value KRW 1.5172 trillion) and a per share price of
KRW 224,000 for each share of the Company owned by KT Corporation (total value
KRW 1.8518 trillion).
The Company has announced that it intends to cancel approximately 4,457,635
shares (or approximately 5% of the total issued and outstanding stock of the
Company as of December 20, 2002) that it is expected to acquire from KT
Corporation. The remaining 3,809,288 shares that the Company is expected to
acquire from KT Corporation (or approximately 4.64% of the total issued and
outstanding shares of the Company as of December 20, 2002) is expected to be
retained by the Company as treasury shares for use in any future mergers and
acquisitions transactions, strategic alliances or other corporate purposes to be
determined by the Company's board of directors. As Korean regulation does not
allow partial cancellation of the shares the Company buys back, the Company has
announced that the purchase of the shares from KT Corporation will be done in
two stages. The first stage is currently anticipated to be completed (pending
FSS and board approval) on December 30, 2002 for the shares which are to be
cancelled and the second stage on January 10, 2003 for the shares which are to
be retained as treasury shares by the Company. KT Corporation is expected to
sell the Company's shares it owns to the Company on the same two dates, in
approximately equal amounts so that approximately 5% of the total issued and
outstanding shares of the Company it owns will be sold to the Company on
December 30, 2002, with the remaining 4.27% to be sold to the Company on January
10, 2003. The
Company also notes that the details of the transaction may change depending on
the FSS review of the application.
FISCAL YEAR 2002 PAYOUT RATIO AND USE OF FUTURE FREE CASH FLOW
In keeping with the Company's focus on building shareholder value, the
Company also announced on December 20, 2002 that the board of directors has set
the dividend payout ratio for the fiscal year 2002 at approximately 10% of net
income, an increase from the approximate 5% payout made for fiscal year 2001.
Although no assurance can be given, that the Company will actually do so, the
Company also announced that it expects to, based on the circumstances at such
time, beginning in the fiscal year 2003, return to shareholders approximately
30% of the Company's free cash flow through cash dividends and/or stock
repurchases.
MERGER WITH SK IMT
The Company also announced on December 20, 2002 that the board of directors
of the Company approved the Company's plan to merge SK IMT Co., Ltd. ("SK IMT")
with the Company by April, 2003. SK IMT is the Company's third generation mobile
technology subsidiary. The Company announced that the merger of SK IMT falls
under Korea's "small-scale merger" process allowing the Company and SK IMT to
merge with the approval of only the respective boards of the two companies.
The Company announced the following terms of the merger. For every SK IMT
share, 0.11276 of the Company's shares is expected to be allocated. The exchange
prices for the Company and SK IMT have been set at KRW 243,000 and KRW 27,400,
respectively. An outside accounting firm, Samil applied the Korean Securities
Exchange Law to calculate SKT's per share price and the Inheritance and Donation
Tax Law to calculate SK IMT's per share price. The Company currently holds
approximately 61.34% of the total issued outstanding shares of SK IMT and will,
based upon the upon exchange ratio, have to issue a maximum of 2,615,878 new
shares (approximately 2.93% of the total issued and outstanding shares of the
Company as of December 20, 2002) to SK IMT's minority shareholders. Under the
Korean Securities Exchange Law, the Company is not allowed to use treasury
shares to facilitate the merger and will therefore be issuing new shares for the
proposed merger with SK IMT.
The Company announced that merging SK IMT into the Company makes sense both
operationally and strategically. The Company announced that management believes
that the merger will not only eliminate inefficiencies coming from providing
almost the same kind of service through two separate entities but is also
expected to leverage the Company's already strong brand name to its third
generation mobile service.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SK TELECOM CO., LTD.
By: /s/ Sung Hae Cho
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Name: Sung Hae Cho
Title: Vice President
IR Office
Date: December 24, 2002