Berjaya Media identifies white knight, but shares fall 59%

By MARK RAO / Graphic By TMR

BERJAYA Media Bhd’s shares noted its steepest plunge in its history after revealing technical issues with its white knight’s (Tan Sri Vincent Tan Chee Yioun) privately owned Singer (M) Sdn Bhd’s audited financial statements.

The media companies’ shares plunged 58.54%, or 12 sen, to close at 8.5 sen as investors feared the stock is heading for a suspension and delisting pending an appeal to the exchange.

The price action was the biggest move since the company’s initial public offering in 1995 as 1.3 million shares exchanged hands.

Berjaya Media’s share price is already down 66% in the past five days and down 65% in the past 30 days.

The loss-making media group is at risk of being delisted from the Main Market of Bursa Malaysia on Nov 7 this year, which would make it the second media group to do so this year after Utusan Melayu (M) Bhd was delisted in Aug 30.

In an exchange filing yesterday, Berjaya Media stated it identified Singer — a private company owned by its major shareholder Tan — as the company to be injected into the group as part of its regularisation plan.

The media group, which publishes The Sun newspaper in Malaysia, slipped into Practice Note 17 status on June 21, 2017, after the company’s shareholders’ equity came in at 25% or lower than its issued capital.

However, Singer is currently resolving a technical issue with the Companies Commission of Malaysia (CCM) on its audited financial statements, according to Berjaya Media’s exchange announcement yesterday.

The company noted it thus requires additional time to finalise a regularisation plan and enter into definitive agreements.

“In view that Berjaya Media failed to obtain an extension of time from Bursa Malaysia Securities Bhd, Berjaya Media will submit an appeal to Bursa Securities to seek for the extension of time to enable the company to finalise the (regularisation) plan,” it stated.

The major shareholder and Berjaya Media intend to continue its listing following the completion of its proposed regularisation plan, it added.

Berjaya Media has until Nov 4 to submit an appeal to Bursa Malaysia or be delisted three days after, on Nov 7. Any appeal submitted after the Nov 4 deadline will not be considered by Bursa Malaysia.

The latter had already rejected Berjaya Media’s application for further extension to submit its regularisation plan in a letter dated Oct 25 this year.

Berjaya Media said it expects Singer to resolve the technical issue with CCM, as well as completing the required justification or due diligence review and valuations of the Singer business, no later than March 31 next year.

This will thus enable Berjaya Media to thereafter enter into a definitive agreement with the consumer electrical products maker and distributor.

The Singer group is involved in the selling and marketing of consumer durable products and motorcycles on instalment option schemes via its nationwide distribution network of 485 shops with 3,000 sales associates.

It registered an average annual proforma after-tax profit of RM37.6 million in the past three fiscal years, while its net assets and shareholder’s fund amounted to RM525.7 million at Dec 31, 2018, the Berjaya Media filing yesterday noted.