Tiong Hiew King In A Hurry To Control Nanyang?

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Jan 30 2007
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Malaysian media tycoon Tiong Hiew King is making a bid to merge his three Chinese-language publishing groups in Malaysia and Hong Kong to create one of the world’s largest Chinese media conglomerates. The merger will combine Tiong’s Sin Chew Media Corp. (KLSE: SINCHEW, stock-code 5090) and Nanyang Press Holdings Berhad (KLSE: NANYANG, stock-code 3964) in Malaysia with Hong Kong-listed Ming Pao Enterprise Corp. (HKG: 0685) via a share swap arrangement creating an entity with market value of about $622 Million.
Stock price of Ming Pao which closed at HK$1.73 on Monday opened at HK$2.35 today and jumped as much as 49 percent to HK$2.58 on the merger news. Sin Chew’s stock price ended the day almost unchanged while Nanyang’s stock price closed 20 cents lower today.
Sin Chew publishes Malaysia’s largest circulated Chinese newspaper, the Sin Chew Daily, while Nanyang produces the country’s oldest Chinese-language daily, Nanyang Siang Pau. Ming Pao Group’s major publications include the Ming Pao Daily News, which is published in Hong Kong, Toronto, Vancouver, New York and San Francisco.
Sin Chew said the enlarged entity would “leverage on its extensive global footprint to expand into the media market in China as well as globally” while Tiong said “The merger is a strategic move to transform Sin Chew Media into an international media group to compete with global media corporations.” Forbes in 2006 said Tiong’s net worth was about one billion dollars, listing him as number 746 of 793 billionaires worldwide.
The merger will see the enlarged group operating through a publishing merger of Chinese-language newspapers and magazines in Malaysia, Hong Kong, the United States, Canada and China. Under the deal which must be signed by April 30, Sin Chew and Nanyang will be de-listed from Malaysia’s bourse and become wholly-owned subsidiaries of Ming Pao. Ming Pao will assume Sin Chew’s publicly traded status and have a dual listing on the main board of stock exchange Bursa Malaysia (KLSE: BURSA, stock-code 1818) and the Stock Exchange of Hong Kong Ltd., investment bank CIMB said in a stock exchange statement.
Sin Chew’s Executive Director Rita Chin said the exercise was targeted to be completed by February 2008, with Sin Chew and Nanyang shareholders expected to vote on the merger in the fourth quarter of this year. Shareholders of SinChew will exchange their stock at 4 ringgit per share for new Ming Pao shares to be issued and credited at HK$2.70 while Nanyang shareholders will exchange their stock at 4.20 ringgit per share for new Ming Pao shares to be issued and credited at the same price of HK$2.70.
The Nanyang Press had created sagas previously when Huaren (investment arm of MCA) bought it and later sold it to Ezywood Options Sdn Berhad which is controlled by timber and media tycoon Tan Sri Tiong Hiew King for a lost estimated at RM100 Million in 2006. Chinese community worried about monopoly of Chinese newspaper industry cried that MCA (Malaysia Chinese Association) should have sold its controlling stake in Nanyang Press Holdings Bhd to other parties instead of Tan Sri Tiong Hiew King who already controls Sin Chew Media Corporation Bhd.

Could Tiong Hiew King wants to make a final move to fully control Nanyang and monopolize the Chinese newspaper industry, fearing political pressure could cause him the Nanyang Press Holdings? But what if Nanyang’s remaning shareholders decided to go against the merger? Will Huaren votes against this giant from being created?

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