Moody's affirms SK Telecom

Moody's Investors Service said it affirmed SK Telecom Co. Ltd.'s A2 issuer and senior unsecured ratings.

The outlook remains stable.

The affirmation is in response to the company's recently announced plan to acquire the leased-line business of SK Networks for about 1.48 trillion won, Moody's said.

While this will increase the company's debt-to-EBITDA ratio to more than 1.8x in the near term, the risks are partially mitigated by operational efficiencies that can be immediately achieved, Moody's said.

The strength of SK's fundamental business and management's commitment to deleverage is likely to bring leverage down to a more moderate level of 1.5 to 1.8x, the agency said. While this is on the weak side for the rating level, Moody's said it draws some comfort from the company's good liquidity profile and strong market position.

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