SK Telecom announced its intention to merge its fabless unit Sapeon with Korean chip designer Rebellions, aiming to strengthen its position in the global artificial intelligence chip market. The two companies have agreed to create a new "homegrown company" to lead the global AI race, capitalizing on the rapidly growing market for neural processing units powering AI services. SK Telecom plans to finalize the merger within the third quarter of this year and establish a new entity by the end of the year, with Rebellions taking on the management responsibilities while SK Telecom remains a strategic investor. The move comes as SK Telecom sees the next two to three years as a crucial period for Korea to gain a competitive edge in the global AI chip market. Rebellions, founded in 2020, has already launched two AI chips and is estimated to have a market valuation of 800 billion won. Meanwhile, Sapeon, established in 2016, has introduced AI chips for data centers and is looking to expand its presence in advanced AI chips with its latest X330 chip. The merger is expected to receive full support from Sapeon's shareholders SK Square and SK hynix, as well as from SK Telecom's rival KT Corp., which is also a strategic investor in Rebellions.