South Korea's LG Telecom said on Thursday that its board had approved a plan to merge with LG Dacom and LG Powercom on January 1, 2010.
The two LG group units also agreed to the merger, with LG Telecom exchanging one share for 2.15 LG Dacom shares or 0.74 LG Powercom shares, they said in a regulatory filing.
The announcement halted trading in the three telecom companies' shares between 0350 GMT and 0420 GMT.
Merging the three companies -- mobile carrier LG Telecom, fixed-line operator LG Dacom and broadband firm LG Powercom -- is expected to help them leverage a bigger customer base and strengthen service offerings.
Analysts consider the merger a necessity for LG to compete with bigger telecom rivals KT Corp and SK Telecom. (Reporting by Seo Eun-kyung; Editing by Jonathan Hopfner)