UTUSAN Melayu (Malaysia) Bhd, the Malay newspaper group that is owned by Umno, is likely to see new owners after it goes through a restructuring.
The newspaper group is going through a staff rationalisation scheme that will likely see its workforce of about 1,500 reduced by half and the closing down of its printing plant in Kuala Terengganu.
Sources say the voluntary separation scheme, which will take effect by the end of this month, involves more than 700 staff.
This will be followed by the closure of its entire magazine division involving five titles and four digital magazines.
The loss-making company will also close down all bureau offices in all states in the country from Dec 1 this year.
Umno controls Utusan, which has been chalking up losses and has been classified as a PN17 company since August this year.
Sources also say that at least two parties, including a team lead by the management, have expressed interest to take over the company after it completes its restructuring.
With accumulated losses of RM74.01mil as at the end of June, Utusan needs a capital injection to revive its operations.
“The new parties will only come in after the clean-up has taken place.
“The staff will be cut by half and the exercise is expected to be completed by next month,” says a source.
It is learnt that Umno was not in a position to inject more money into Utusan and is prepared to exit the company if an offer to continue its operations comes along.
“Another factor that comes into consideration is to de-politicise the ownership of the newspaper so that it can be run independent of any influence,” says a source.
Towards this end, if the proposal by the management is viable, it could get consideration. Utusan has seen its circulation drop over the years but the company was kept alive by Umno, which used to rule the government. However, without government support, the company is unable to sustain its operations.
As a PN17 company, Utusan is an entity with insufficient shareholders’ funds. It has gone to the Corporate Debt Restructuring Committee (CDRC) to put its finances in order and come up with a solution acceptable to creditors.
The board of Utusan has also seen changes since Umno is no longer in control of the government. In June this year, Datuk Abdul Aziz Sheikh Fadzir was appointed as executive chairman. It has long term and short term debts of RM139.5mil while cash stands at RM13mil as at the end of June this year. Of its debts, the short term obligation is RM48.43mil.
However, Utusan has investment assets in its books of RM90mil and also property, plant and equipment valued at over RM200mil.
In the past few months, Utusan has been vocal against former Prime Minister Datuk Seri Najib Tun Razak and some of the other Umno leaders. There is also an increasing call for the newspaper to be de-politicised and for it remain as a voice of reason for the Malays.