SK Telecom’s sale of shares in SK Horizon (tentative name) and equity financing of SK Horizon

Lee & Ko advised SK Telecom Co., Ltd. on the sale of 24,481,427 existing shares of its subsidiary, SK Horizon Co., Ltd. (tentative name), to KKR and the IMM Investment-Stonebridge Capital consortium for approximately KRW 1.88 trillion, as well as the additional investment of approximately KRW 1.2 trillion by the Purchasers through a subsequent issuance of new shares by SK Horizon Co., Ltd.

The Transaction was undertaken to secure funding for the business growth of SK Horizon Co., Ltd., a company to be established through the spin-off of the business division of SK Broadband Co., Ltd. engaged in the provision of data center services (including CDN services) and international leased line services based on its self-owned submarine cables, thereby enhancing its corporate value. As a transaction in the AI data center sector, one of the most rapidly growing areas of the digital infrastructure market and given its substantial deal size and future growth potential, the Transaction attracted significant market attention.

Lee & Ko provided comprehensive legal advice to SK Telecom Co., Ltd. throughout the entire process, from the review of the optimal transaction structure to the review of various licensing and regulatory matters and consultations with the relevant authorities, responding to the Purchasers’ due diligence, the review of the optimal transaction timeline for the implementation of the complex transaction structure, and the drafting, negotiation and execution of the relevant agreements. In particular, the Transaction involved a complex structure, including the execution of two separate share purchase agreements with the respective Purchasers, the contemplated issuance of additional new shares by SK Horizon Co., Ltd. to the Purchasers, and the execution of a tripartite shareholders’ agreement. Lee & Ko appropriately analyzed the various legal issues arising in the review and implementation of the transaction structure and proposed effective solutions, thereby contributing to the successful execution of the Transaction.