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South Korea's SK Telecom, partner buy ADT Caps from Carlyle for $1.2 billion

By Joyce Lee

SEOUL (Reuters) - South Korea's largest telecom firm, SK Telecom Co Ltd <017670.KS>, said on Tuesday it and a partner had decided to wholly buy domestic security systems company ADT Caps for about 1.28 trillion won (885.09 million pounds).

SK Telecom said in a statement that it would pay 702 billion won for a 55 percent stake in Siren Holdings Korea, a holding company that owns 100 pct of ADT Caps, while partner Macquarie Infrastructure and Real Assets, a Macquarie Group Ltd (MQG.AX) unit, would pay 574 billion won for a 45 percent stake.

SK Telecom and Macquarie plan to ink the deal with seller Carlyle (CG.O) and complete the transaction as early as the third quarter of this year, SK Telecom said.

SK Telecom and Macquarie valued ADT Caps' business at about 2.97 trillion won ($2.8 billion), including the 1.28 trillion won plus about 1.7 trillion won in debt, the telecom firm said.

The valuation was about 11 times the firm's earnings before interest, taxes, depreciation and amortisation (EBITDA), which was in line with average valuations for global security systems companies' mergers and acquisitions, SK Telecom said.

Through ADT Caps, South Korea's second-largest security systems firm with about 570,000 subscribers and about 30 percent market share, SK Telecom said it planned to strengthen its security business and expand its household clients.

ADT Caps, a former unit of Tyco International Inc, was owned by Carlyle after the private equity firm bought it at auction for $1.93 billion in February 2014.

(Reporting by Joyce Lee; Editing by Stephen Coates)