KT to cancel W1tr of stocks by 2028 for corporate value

KT Corp., a major South Korean mobile carrier, said Tuesday it will cancel 1 trillion won ($726 million) worth of treasury shares by 2028 as part of its efforts to enhance its corporate value.

Under the "value-up program," KT will focus on improving profitability and evolving into a comprehensive artificial intelligence and information technology company, the company said in a statement.

KT aims to achieve a 9 to 10 percent return on equity by 2028 by restructuring low-growth businesses and selling non-core assets and idling properties. The ROE target is up from the current 6 percent, it said.

The company said it will also increase the ratio of the AI and IT businesses in its overall sales from six percent to over 19 percent in 2028.

For all of 2023, KT reported 26.38 trillion won in sales.

The planned share buyback aimed at enhancing shareholder value will take place over four years starting in 2025, the statement said.

Last month, KT said it aims to generate a cumulative 4.6 trillion won in sales by 2029 through its AI partnership with Microsoft Corp.

In September, KT and Microsoft signed a five-year agreement to invest a combined 2.4 trillion won to jointly advance AI technologies, including developing new AI models tailored to Korean language and culture, as well as new cloud services catering to the needs of Korean corporate customers.