The government said Stage X had failed to raise the fully required paid-in capital to launch operations

The government of South Korea confirmed that it has revoked the license of Korean company Stage X as the country’s fourth mobile operator, due to the company’s failure to secure financing and meet other requirements, local news agency Yonhap reported.

South Korea’s Ministry of Science and ICT said that it has finalized the license cancellation process and has refunded the KRW43 billion ($31.1 million) paid for the frequency allocation to Stage X.

According to the ministry, the operator had failed to raise the fully required paid-in capital of KRW205 billion. The ministry also said there were discrepancies in the ownership ratios of major shareholders compared to what was Stage X had stated in the frequency allocation application.

The report also stated that Stage X insisted that the government’s move was unfair and said it would take necessary legal and administrative steps. An official at the company said it was considering various options, including filing a lawsuit for damages, against the government.

The Korean government had expected Stage X to become the country’s fourth mobile carrier, joining SK Telecom, KT and LG Uplus.

Stage X is a consortium that is integrated by Stage Five, a communications affiliate of tech giant Kakao Corp. and other unidentified companies. Stage X planned to launch nationwide mobile network services in the first half of 2025 via spectrum in the 28 GHz band. The company was planning to invest KRW 612.8 billion to deploy its 28 GHz 5G network across South Korea. The telco had said it would build 6,000 base stations, which is the mandated installation standard for the 28 GHz frequency network.

The country’s Second Vice Science Minister Kang Do-hyun previously said that the government had concluded the capital raising claimed by Stage X could not be trusted and that it would be difficult to properly carry out the business if the capital specified in the allocation application was not properly secured.

“Considering expected future concerns of partners such as equipment manufacturers, investors and users, we concluded that cancellation of the selection of companies subject to allocation was inevitable,” he added.

Kang also said that the government may consider another auction for the 28 GHz spectrum band for the 5G network, if necessary.

In May, Japanese companies Rakuten Mobile, Rakuten Symphony and Stage X had announced an agreement with the aim of establishing a comprehensive framework for strategic collaboration between the companies.