Earthlink (NSDQ: ELNK) has confirmed that SK Telecom (NYSE: SKM) will provide up to $270 million to support their struggling wireless JV Helio, effectively pulling Earthlink out of committing any further cash.. The wireless carrier’s ownership is split 50/50 between SK Telecom and Atlanta-based Earthlink, but with this additional infusion, that is expected to change.
In June, SK Telecom pledged $100 million to help keep the venture going. The investment was provided with the expectation that Earthlink would match it dollar for dollar. Earthlink said that SK Telecom’s move is enough to cover Los Angeles-based Helio for the time being with out any additional funding from Earthlink. The two partners are currently in discussions to update their existing agreements to reflect SK Telecom’s added investment and its future governance of Helio. No further details on how Helio’s governance would be divided were given .
Helio ended August with 130,000 subscribers, and expects to end the year with between 200,000 and 250,000 subscribers and revenue between $140- and $170 million. Helio expects a full year, net loss of $340- $360 million. Release
InfoWorld: In its own news release, SK Telecom said Helio may be able to raise funds from the market without drawing further investment from either parent. That could mean venture capital, an initial public offering or other sources, said Helio spokesman Rick Heineman.
– DJ (via Easybourse): Unrelated to its Helio investment, SK Telecom has put up $110 million to start an online business in the U.S., though the exact nature of that business is not known.