KUALA LUMPUR: Star Media Group Bhd
has received shareholders’ approval to dispose of its 52.51% stake in Singapore-listed Cityneon Holdings Ltd.
At its EGM on Friday, the group received 94.97% of the votes representing 506.69 million shares to dispose of the stake for S$115.61mil or about RM360mil to Lucrum 1 Investment Ltd. The disposal translates into a gain on disposal of RM214.1mil for Star Media.
Star Media Group chairman Datuk Fu Ah Kiow said the disposal would allow the group to unlock value in its investment and concentrate on the expansion of its primary business.
“We believe that the offer price of 90 Singapore cents per share represents an attractive valuation for Star to realise its investment in Cityneon and has already factored in its growth potential,” he said.
For the financial year ended Dec 31, 2016 (FY16), Cityneon recorded a profit after tax after minority interest of S$6.68mil.
Based on the earnings of Cityneon for FY16, the disposal represented an implied price-to-earnings ratio (PER) of approximately 32.97 times.
Star Media Group plans to use RM200mil from the proceeds of Cityneon sale as future investments, RM154.09mil as working capital and the remaining RM6.08mil as expenses in relation to the proposed disposal.
Cityneon, a full service ideas agency, has five business segments – events, exhibitions, experiential environment, interior architecture, and intellectual property rights (IPR).
The IPR segment was created through the acquisition of immersive attractions company Victory Hill Exhibitions Pte Ltd in 2015, which has the rights to hold the successful Marvel Avengers S.T.A.T.I.O.N interactive exhibition.
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