SEOUL, KOREA - The share price of iriver, the consumer electronics company specializing in the manufacture of digital audio players and other portable media devices, is on the rise on the news of its possible sale to SK Telecom. At 9:07 am on June 2, the shares of iriver were traded at 2,800 won, up 12.22 percent from 2,495 won on the previous trading day. This is a rise for four consecutive trading days. The price once shot up to 2,865 won, a 52-week high.

 

This is largely because of SK Telecom which is widely believed to be mulling an acquisition of the MP3 player maker. According to industry sources on June 1, SK Telecom will send a letter of intent to Vogo Fund, the largest shareholder of the company on the 2nd. In the bidding for iriver, other suitors in addition to SK Telecom are reported to take part in, including a Japanese audio maker and a domestic private equity fund firm.

 

Until the mid-2000s, iriver was one of the best-selling MP3 player brands in Korea and elsewhere. Soon afterward, however, it began suffering financial difficulties as the popularity of Apple's iPod overshadowed iriver. The company was sold to Vogo Fund in 2007. Even though the private equity fund paid 60 billion won for the 34.5-percent stake in the company at the time, the current value is less than 30 billion won.

 

Of all the potential bidders, SK Telecom is considered the strongest contender as the mobile telecom service provider will be complemented with device manufacturing capabilities. Currently iriver produces low-cost smartphones, wearable devices, automobile black boxes, intelligent robots, and ebooks, as well as portable audio players.