SK Telecom Calls Rumors Of Virgin Mobile-Helio Merger “Groundless”
Rafat broke the news Thursday that MVNO’s Virgin Mobile and Helio were considering a merger, and despite the WSJ verifying the tie-up with their own sources, SK Telecom (NYSE: SKM) said on Saturday that it was not in “any sort of talks” with Virgin and remained “committed” to the struggling Helio. According to Dow Jones, who quoted SK Telecom spokesperson Mina Ryu the report that the Korean telecoms company would buy Virgin Mobile (NYSE: VM) and infuse it with cash, and then Virgin Mobile would buy out Helio in an all-stock deal was “groundless.” She added, however, that SK Telecom is “actively seeking opportunities” to expand in the U.S. Reuters also reported that an unidentified source had said Virgin Mobile and SK Telecom were in “early talks” on a deal, but the person “who was not authorized to comment on the matter and asked not to be identified,” did not give any more detail on what that deal might be.
Related StoriesPosted In: Money, M&A & Venture Capital, Mergers & Acquisitions, Companies, Helio, SK Telecom, Virgin, Virgin Mobile
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Comments (7)
May 12, 2008 1:01 PM
Glad to see that SK Telecom is rational and that the rumors were false.
The deal made zero sense. It probably was spread by stock market traders!
May 12, 2008 9:53 PM
The merger will happen, you can put your money on it
May 14, 2008 3:25 PM
I’ve always admired Helio for their no-nonsense approach to marketing. In fact, when they launched in October 2005, Helio and Sky Dayton promised to “End Confusing Rate Plans and Cheap Gimmicks.” Apparently something went terribly wrong because they are advertising their “Ocean” handset for $99. It is not $99 and if you read my blog post, you will see exactly what I mean.
Whatever you say or promise in your advertisement or email campaign, you better be able to deliver–without making someone jump through hoops. When it comes to marketing, follow the golden rule “Do unto others, as you would have others do unto you.” Honesty is always the best policy in business and in life. The most successful companies and entrepreneurs I know are also the most honest and sincere people I’ve ever met.
After this experience I looked into the state of affairs at Helio and discovered they’ve already burned through $560M. Their balance sheet is a train wreck with cash dwindling and a loss at Helio of over $326 million last year alone. To make matters worse, Sky Dayton quit and left Helio a bill for over $600,000 in back pay and severance. A sad ending for a company that launched with such star-studded fanfare and a promise to change the wireless industry.
If Helio can’t be honest, they should just not advertise! They will avoid pissing people off with cheap gimmick emails. Better still, by not advertising–they can save lots of money. That’s money that can be used as decent severance packages for Helio employees when they go bankrupt.
May 14, 2008 4:51 PM
I love how you link everything except YOUR source for denying the rumor. Nothing linked here says the deal isn’t happening. Just your sentence.
Jun 23, 2008 7:20 PM
if helio is going to merge or be bought, what are the customers going to do. will they be able to keep their phones with virgin or just wake up one day without their phone working. and i have helio and when i first sighed up i had to say 150 bucks and was told at the end of my contract i would get that back. will i?
Jun 27, 2008 6:16 PM
Not only did the merger happened, Helio just laid off half their employees on the day of the merger announcement. Another 30% of them will feel the axe within the next 30 days. Nice way to start off a merger, shades of Cingular / AT&T;.
Jun 27, 2008 6:16 PM
Not only did the merger happen, Helio just laid off half their employees on the day of the merger announcement. Another 30% of them will feel the axe within the next 30 days. Nice way to start off a merger, shades of Cingular / AT&T;.