SK Telecom Considering Investing In Blockbuster (SKM)

SK Telecom SKM, South Korea's top mobile carrier is considering investing in bankrupt U.S. video rental chain Blockbuster Inc, the company said today. The company announced last month it would sell itself to a group of creditors for $290 million. This is a "stalking horse bid," which would used as a starting point should other bidders emerge. "We are considering investing in Blockbuster as we are looking at many opportunities overseas. But no details have been decided," an official at SK Telecom said on condition of anonymity to Reuters. The company declined to comment through a company spokesperson. "We are slightly perplexed by (SK Telecom's interest) because no immediate synergies come to mind and the required restructuring of the company could be very costly," David Lee, an analyst at CLSA said in a report. "A consummated Blockbuster deal would be quite negative due to the large size of the company and its declining business," he said. ADR's of SK Telecom closed at $18.33 yesterday.