KT Corp., South Korea's largest fixed-line phone and broadband operator, announced on March 31 that it completed procedures to acquire Kumho Rent-a-car Co., a car rental unit of the ailing Kumho Asiana Group.
Lee Hee-soo, chief executive of KT Rental, an equipment rental unit of KT Corp., was tapped as the new chief of the Kumho Rent-a-car, the country's largest rental car company, KT Corp. said in a release.
Lee said the car rental company aims to bring in 1 trillion won (US$883.94 million) in revenues and 150 billion won in operating profit by 2013.
KT Corp. said it hopes to secure 35 percent of the South Korean domestic market. KT Rental and Kumho Rent-a-car dominate a combined 30 percent share in the local car rental market.
Kumho Rent-a-car owns 50,000 vehicles and operates in 169 locations, including nine overseas. The company posted 360 billion won in revenues in 2009.
Kumho Rent-a-car was a wholly owned subsidiary of Korea Express Co., a logistics unit of the troubled Kumho Asiana. The logistics company bought Kumho Rent-a-car for 307.3 billion won in December 2008.
Korea Express sold its entire stake to KT Corp. for 300 billion won at the end of last year in an effort to improve parent company Kumho Asiana's financial health.
KT Corp., also the country's second largest mobile carrier, expects to develop new services integrating telecommunications technology in auto vehicles. The company said it also plans to offer driving information through a navigation device in its vehicles.