Potential buyers are showing little interest in undersea cables firm KT Submarine due to its limited scale and concerns over its growth potential as competition intensifies.

KT Corporation, one of the major telcos in South Korea, wants to sell a controlling stake and has tapped several financial advisory firms, industry sources said. They have sounded out potential buyers of the company, but without any success.

Founded in 1995, KT Submarine specializes in the construction of undersea cables. KT, the largest shareholder in the Kosdaq-listed company with a 36.9% stake, had talks with Hyundai Heavy Industries to sell its stock in 2012, but there was no deal.

“KT Submarine has long been named as one of the potential targets in the mergers and acquisitions market,” an industry insider said. “In addition to undersea cable construction, it has other business areas such as installation and maintenance of offshore structures, which in fact is not directly related to telecommunication, and that’s why the company has been considered less important to KT.”

A major corporate restructuring has been underway at KT since Koo Hyun-mo took over as chief executive officer in March last year. Under his leadership, KT has expanded its investment in technologies related to telecommunication, such as artificial intelligence and cloud, while seeking to sell off non-core businesses.

Sources said KT Submarine could benefit from growth in offshore wind power, but at the same time there are concerns about whether its market position is strong enough to survive the intensifying competition in the undersea cable market.

The company’s smaller scale and heavy dependence on intercompany transactions make it less attractive, industry watchers said. KT’s 36.9% stake in KT Submarine is expected to be worth between 40 billion won ($36.4 million) and 50 billion won ($45.5 million) with its recent market capitalization ranging between 112 billion won and 120 billion won. (Reporting by Ik-hwan Choi)