Expect a transaction to yield some clues about which smart phone-related patents are interesting, what they are worth and to whom.
Struggling South Korean handset maker, Pantech, announced this week that it is up for sale. Pantech’s financial troubles could be other technology companies’ gains, especially if they are interested in cracking the lucrative Korean smart phone market.
A Pantech sale for all or parts of the company also will test the volatile market for US cell phone patents many businesses and NPEs still covet.
After filing the equivalent to Chapter 11 bankruptcy earlier this year patent-rich Pantech, which sells in the US through AT&T, Verizon and others, announced recently that it was for sale.
Envision IP published a report yesterday that provides a snapshot of Pantech’s patent portfolio. While the size of the portfolio is only a fraction of Samsung’s (60,000 total US patents) and LG’s (30,000), the patents it contains, a number covering signal transmission, appear to be similarly valid based on citation analysis.
Pantech currently owns 291 US patents, with 269 utility patents and 22 design patents. Pantech also owns 2,654 foreign patents, with the 2,239 of these being Korean patents, and 211 European patents.
“In terms of reverse and forward citations, the portfolios of all three companies are relatively comparable,” said Maulin Shah of Envision IP. “The citation analysis indicates that Pantech’s patents, on average, are technically as strong as Samsung’s patents from a validity standpoint, based strictly on the reverse citation count. With regards to how
innovative Pantech’s patents are to the mobile device sector, the patents appear slightly less fundamental than both LG and Samsung’s patents, based strictly on the forward citation count.”
Korean network carrier SK Telecom has been considered the front-runner for the bid. Other Korean conglomerates such as Samsung, LG and Hyundai Motor Group have also been mentioned as potential buyers. (In 2013 Samsung acquired a 10% stake in the struggling company.)
No US or European buyers have been named.
“The possibility of a foreign company nabbing Pantech is also very real,” reports CNET. “Earlier in April, an Indian consumer electronics giant, Micromax, had considered buying a sizeable stake in Pantech. Chinese handset makers Huawei, Lenovo and Xiaomi could all benefit from acquiring Pantech, forging entry into the nigh-impenetrable Korean handset market.”
Image source: pantechusa.com; envisionip.com
Bankruptcy of a technological company always has patent bonuses for the bidders. I would be very surprised if a non-Korean company paid as much as SK-Telecom is willing.