Virgin Mobile To Buy Helio For $39M

June 27, 2008 10:33 a.m. EST

New York, NY (AHN) - Virgin Mobile announced Friday it will acquire Helio from SK Telecom in a $39 million all-stock transaction.

Virgin Mobile, a mobile virtual operator with 5.1 million subscribers, will gain 170,000 high-end Helio subscribers. Helio, founded in 2006 by the Korean telecom and Internet provider Earthlink, has fallen on hard times.

For Virgin Mobile, the deal will let it expand into post-paid contracts instead of relying totally on pre-paid accounts.

As part of the deal, SK Telecom and Virgin Group will invest $50 million in Virgin Mobile, a move providing the South Korean carrier with a 17 percent stake in Virgin Mobile.