KT to buy BC Card stake from Shinhan

Credit card company Shinhan Card said Tuesday it plans to sell a 14.9 percent stake of BC Card to the country’s No. 2 mobile carrier KT Corp. 

The share sale plan, confirmed by a Shinhan official, is based on the condition that Woori Bank successfully completes a transfer of 20 percent of BC Card to KT – a deal currently in the works. 

KT is to become the largest shareholder of BC Card if it manages to seal both deals, and it plans to use the card firms’ communication networks to expand its mobile transaction business on smartphones. 

“Shinhan plans to transfer its BC stake to KT once Woori completes its sale to the telecom operator,” said a Shinhan Financial Group official. Shinhan acquired its BC stake when the company merged with Chohung Bank back in 2006. 

“Shinhan doesn’t necessarily have to hold on to BC because we already have our own credit-card business.” Despite BC’s disappointing earnings results for the second quarter, with a net loss of 48.9 billion won, its payment network is expected to boost KT’s expansion into the telecom-credit card convergence business in a bid to overtake SK Telecom Co., its rival. 

The largest shareholder of BC Card currently is Bogo Fund with a 30.68 percent stake.

“The final amount of shares to be sold and sale price have yet to be determined,” the Shinhan Financial official said.

Shinhan’s plan on the sale of BC Card stake follows Woori’s announcement on the plans to sell a 20 percent stake out of its total 27.65 percent interest in BC Card to KT by the end of this year.

“Transfer of Woori’s share will be sealed at the board meeting soon. As for the deal with Shinhan, the decision to sale isn’t yet finalized although we have strong interest in management of BC,” a KT official said.

“KT will consider buying more of BC interest held by other 11 banks in the country. The deal with Woori is likely to be done by the year-end,” he said.