| Media Prima Agrees To Acquire 100 Pct Stake In NTV7 |
|
KUALA LUMPUR, Oct 27 (Bernama) -- Media Prima Bhd has agreed to acquire 100 percent stake in television station, NAT Seven TV Sdn Bhd (NTV7), for RM90 million.
The sale and purchase agreement for the acquisition was carried out earlier Thursday between Media Prima and the existing shareholders of the NTV7 group.
The acquisition covers all operations under the NTV7 group which include NTV7 and two related companies, Synchrosound Studio Sdn Bhd and Encorp Media Technology Sdn Bhd, the respective licence holder and operator of WaFM radio station.
"The acquisition of NTV7 is a good investment for Media Prima as the television station has a great and strong brand name which will certainly add value to the group," said Media Prima's chairman Datuk Mutalib Abdul Razak at a media briefing, here Thursday.
The acquisition marked the successful completion of the collaboration and assistance exercise announced on July 13, 2005, between Media Prima with Synchrosound and Encorp Media, in which Media Prima assisted in the debt and corporate restructuring of NTV7 and WaFM.
The acquisition of NTV7 also provides an investment opportunity for Media Prima to further expand its media investment portfolio, which already has TV3, 8TV and Channel 9 under its belt.
The group expects to derive potential synergistic and cost saving benefits from streamlining its enlarged operations and undertaking collaborative marketing strategy between its broadcast operations after acquiring NTV7.
Media Prima's chief executive officer Abdul Rahman Ahmad said after the acquisition and debt restructuring, NTV7 would have to pay a reduced debt of RM145 million compared to the previous RM260 million.
NTV7 would settle half the debt upon completion of the acquisition by year-end, while the other half would be settled over a three-year period, he added.
Asked whether there would be a change in NTV7's management, Abdul Rahman said the group was committed to maintaining the existing management and the company's strong branding.
"Obviously, certain things need to be improved, but at the end of the day we want to maintain the existing strong branding of NTV7. We are buying an established market player," he said.
Abdul Rahman said NTV7 has a strong revenue track record, but revenue was expected to drop slightly in 2005 due to competition from 8TV, which was seeing a growth in viewership.
"We will maintain and nurture the strong branding of the My Feel Good Channel, and reposition it as urban Malaysian family station tergeting audience between the ages of 25 and 45, kids as well as the Chinese community," he said.
On cost savings for the group, Abdul Rahman said it was looking at more than RM15 million.
"We hope to achieve the target," he said.
He added that when the group acquired TV3, it had managed to save about 15 percent in cost, of which five percent was spent on improving the content and high-quality programmes.
"We expect to implement the same strategy for NTV7," he said.
In terms of television viewership, TV3, NTV7 and 8TV collectively have a viewership share (inclusive of pay television) of about 48 percent.
NTV7 alone currently has eight percent share of all television audience and 30 percent of the total free-to-air television advertising expenditure.
Abdul Rahman said he hoped the ADEX in Malaysia would grow beyond 30 percent for television.
"We believe that there is significant room for further growth in the television ADEX in Malaysia. Collectively, television currently accounts for only about 29 percent of the total ADEX, which is nowhere near what other countries in this region experience, ranging between 40 and 70 percent share," he said.
"This acquisition allows for consolidation within the industry and enable us to focus to work together with everyone involved to ensure that television advertising expenditure in Malaysia will grow strongly in the future for the benefit of all parties," he added.
On the course for WaFM, Abdul Rahman said the group has yet to make any decision on the radio station.
"We are still studying and will make an announcement in early December. We have some ideas for it," he said.
-- BERNAMA
|
|
|