NSTP appoints two banks for Utusan deal

  • Business
  • Wednesday, 29 Nov 2006

THE New Straits Times Press (M) Bhd (NSTP) is planning to acquire Utusan Melayu (M) Bhd to forge a strong alliance between its Berita Harian and Utusan Malaysia.  

Riding on the increase in readership and advertising expenditure or adex in the Malay media, this exercise is targeted at consolidating the two major Malay media in a group which also publishes the popular Harian Metro and Kosmo!. 

StarBiz understands that AmInvestment Group and BNP Paribas have been appointed to structure the deal, and the market expects an announcement soon. 

Sources said the tentative plan could be to position Berita Harian and Harian Metro in the south of Peninsular Malaysia where it has a good following. Meanwhile, Utusan Malaysia and Kosmo! will be sold mainly in the north and east coast, which is their current stronghold. 

Both papers will tackle the East Malaysian market on a unified basis. 

“The aspiration is for a win-win situation to emerge,” a source said. Both Utusan Malaysia and Berita Harian have a long history in this country; they have already carved their own identity and garnered their own pool of loyal readers. The thinking is that they should not compete with each other. 

“At the end of the day, all parties will have to look at what is being proposed and evaluate the deal based on market valuations and other factors. 

“Unlike bank mergers which result in an enlarged customer base, mergers in the media sector have to take into account factors such as readership preference and loyalty.  

“All possible angles will be weighed and the parties are prepared should the painful decision arise to discontinue with one of the papers, or for the consolidation to take on a different form,” the source added. 

In the AC Nielsen Media Index for the first quarter of 2006, covering the 12 months from April 2005 to March this year, the readership of Utusan Malaysia stood at 1.241 million, declining 36,000 or 3% from 1.277 million. 

The latter figure was recorded in the fourth quarter of2005 (covering the 12 months from January 2005 to December 2005). 

In the same period, the New Straits Times (NST) recorded a 10,000 or 3% drop in readership to 295,000 (from 305,000). 

Utusan Malaysia is one of the newspapers under Kumpulan Utusan, which was set up in 1938 to publish the country’s first Malay newspaper. 

Recently, the group’s weekly Jawi newspaper, Utusan Melayu Mingguan, ceased operations due to declining advertising revenue and operational losses. 

The NST is published by The New Straits Times Press (M) Bhd set up in 1845, which is in turn controlled by Media Prima Bhd. 

Berita Harian Sdn Bhd, which was formed in 1957 to rival Utusan, also falls under the ambit of NSTP. In the same AC Nielsen Survey, the readership of Berita Harian was recorded at 1.292 million, down 5% from 1.358 million. 

According to the recent reports, Audit Bureau Circulation had posted the daily circulation figures of Berita Harian at over 200,000 copies, the NST’s daily circulation at more than 138,000 copies and Utusan Malaysia at over 210,000 copies. 

NSTP closed unchanged at RM2.44 on volume of 15 million shares; Utusan rose 10 sen to RM1.35 on four million shares traded. Both stocks have been rallying since last week on talk of this possible deal. 

 NSTP :  [Stock Watch]  [NewsUTUSAN :  [Stock Watch]  [News]

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