By ALIFAH ZAINUDDIN / Graphic By TMR
Media Prima Bhd is expected to dispose of two properties and a vacant parcel of land owned by The New Straits Times Press (M) Bhd (NSTP) to PNB Development Sdn Bhd for RM280 million cash.
The media conglomerate entered into three separate sale and leaseback agreements with PNB Development on properties that include Balai Berita Bangsar and Balai Berita Shah Alam.
Upon completion of the proposed sale, the group will realise an estimated gain of RM127.7 million. Its operations would continue as usual.
Media Prima said the exercise will generate total savings of RM10 million per annum and allow the group to preserve cash for its business transformation efforts.
Group MD Datuk Kamal Khalid said the sale and leaseback exercise takes into account the growth potential and opportunities for Media Prima operating as an asset-light group model.
The proposed sale and tenancy is expected to be completed by the fourth quarter (4Q) of this year.
For its 2Q ended June 30, 2018, Media Prima posted a net profit of RM31.95 million against a net loss of RM132.91 million in the corresponding quarter a year ago.
Revenue improved 4.1% year-on- year to RM342.37 million as core advertising and commerce revenues gained momentum during the quarter, in line with the festive season.
NSTP had also sold its 21.36% stake in Malaysian Newsprint Industries Sdn Bhd (MNI) for RM45.4 million cash as it shifts its focus on digital content delivery. The move enabled the group to recoup part of its investment in MNI which was fully written down last year.
“We will remain focused on doing what we do best across our digital and traditional assets, with a view of attaining sustainable profitability and delivering high returns to our shareholders,” Media Prima group chairman Datuk Mohd Nasir Ahmad said.