China Unicom buys back shares from SK Telecom

China’s second-largest mobile operator, China Unicom, is buying back a 3.79% stake in itself owned by South Korean operator SK Telecom for USD1.28bn. The deal is a blow for the South Korean firm's ambitions to expand in the world's largest mobile market.

SK Telecom, which is South Korea's biggest mobile operator, acquired a 6.6% stake in Unicom in 2006 after converting USD1bn worth of bonds into stock. The stake was later diluted by a merger between China Unicom and China Netcom.

The buyback follows additional investment in China Unicom by Spain's Telefonica, which recently overtook SK as the Chinese operator's largest foreign investor. Earlier this month, Telefonica indicated that it intends to increase its holdings in the firm by 50%.