PETALING JAYA: Media Prima Bhd has sold The New Straits Times Press (M) Bhd’s (NSTP) Balai Berita in Bangsar and the land where its printing plant is located in Shah Alam to PNB Development Sdn Bhd for RM280mil.
This is the second major asset that the group has disposed of after selling its 21.36% interest in Malaysian Newsprint Industries Sdn Bhd (MNI) for a cash consideration of RM45.4mil on May 2.
In an announcement yesterday, Media Prima said the sale of the properties would transform the company into an asset-light group better positioned to expand into the digital and commerce segments.
Media Prima group managing director Datuk Kamal Khalid said that NSTP operations would continue as usual because Media Prima would enter into tenancy agreements with PNB Development for both the facilities in Bangsar and Shah Alam.
He said the exercise, which would see the group realise an estimated gain of RM127.7mil, would generate total savings of RM10mil per year. “It would allow the group to preserve its cash reserves for its business transformation efforts,” said Kamal.
In the second quarter ended June 2018, Media Prima recorded a profit of RM32mil from a revenue of RM342.4mil. In the corresponding period last year, it registered a loss of RM132.9mil on the back of a turnover of RM328.8mil. For the cumulative six-month period, Media Prima turned in a profit of RM10.13mil on a turnover of RM623mil.
The sale of MNI, an investment that was completely written down last year, was done during the quarter.
Media Prima’s mainstay free-to-air television revenues declined by 6% in the first six months of this year, while NSTP’s topline also was lower by 13% due to lower advertising and newspaper sales by 15% and 30%, respectively.
On the sale of Balai Berita and the Shah Alam properties, Media Prima said it was done through a real estate firm and the group of potential buyers included property developers, real estate investment trusts and major manufacturing companies.
At the end of the marketing period, only two conditional offers were submitted; one for the Bangsar property and another for the properties in Shah Alam.
“Both conditional offers were less attractive in comparison to the offer made by PNB Development,” said Media Prima.