South Korea's antitrust regulator said Wednesday it has decided to approve the deal by the country's major chipmaker SK hynix Inc. to buy a local foundry firm, Key Foundry.

In October, SK hynix said it inked a deal to acquire a 100 percent stake in the 8-inch wafer foundry manufacturer for 575.8 billion won ($474.85 million) in a move to boost its presence in the non-memory sector.

The Fair Trade Commission (FTC) said it has approved the deal, as the takeover is not expected to hamper competition in the market.

Key Foundry makes chips for power management, display drivers and microcontroller unit semiconductors.

SK hynix runs a foundry business through its affiliate SK hynix system IC, which has a similar production capacity to that of Key Foundry.

If combined, their market share in the overlapped business field would come to around 5 percent of the domestic market and about 1 percent in the global market, making the acquisition unlikely to cause concerns over the possible undermining of market competition, the FTC said. (Yonhap)