1) What are the main media assets within Media Prima Berhad (MPB) group?
The main group structure is depicted in the following diagram:
2) What is the background of MPB?
MPB was established pursuant to a comprehensive group and debt restructuring exercise involving the de-merger of Malaysian Resources Corporation Berhad’s media assets, namely Sistem Televisyen Malaysia Berhad ("TV3") and the New Straits Times Press ( Malaysia) Berhad ("NSTP"). Under the corporate restructuring exercise completed in August 2003, MPB acquired a 100% equity stake in TV3 and a 43% equity stake in NSTP. MPB assumed the listing status of TV3, which culminated in the successful listing of MPB on the Main Board of Bursa Malaysia Securities Berhad on 22 October 2003.
In 2003, MPB also acquired an 80% equity stake in Merit Idea Sdn Bhd, which owns a 99.5% stake in Metropolitan TV Sdn Bhd, a company with a Content Application Service Provider license for free-to-air ("FTA") television broadcasting. This enabled the group to launch a second television network under the brand of "8TV" on 8 January 2004. On June 11 2007, MPB had entered into a conditional share sale agreement with Intact Media Sdn Bhd to acquire the remaining 20% equity stake in MISB.
MPB also completed its 100% acquisitions of CH-9 Media Sdn Bhd, the owner and operator of the former Channel 9 television network and Natseven TV Sdn Bhd, the owner and operator of ntv7 television network in 2005. Channel 9 was re-launched as TV9 on 26 April 2006.
Year 2005 also witnessed MPB's maiden efforts to venture into radio broadcasting through the acquisition of Perintis Layar Sdn Bhd, which holds a 75% stake in Max Airplay Sdn Bhd ("Max"). Max has been awarded the right to manage, operate and maintain a radio station by Malaysia Airports (Sepang) Sdn Bhd. In addition, MPB also acquired Synchrosound Studio Sdn Bhd, a radio broadcasting license holder, during the same year.
In 2003, MPB also acquired an 80% equity stake in Merit Idea Sdn Bhd, which owns a 99.5% stake in Metropolitan TV Sdn Bhd, a company with a Content Application Service Provider license for free-to-air ("FTA") television broadcasting. This enabled the group to launch a second television network under the brand of "8TV" on 8 January 2004. On June 11 2007, MPB had entered into a conditional share sale agreement with Intact Media Sdn Bhd to acquire the remaining 20% equity stake in MISB.
MPB also completed its 100% acquisitions of CH-9 Media Sdn Bhd, the owner and operator of the former Channel 9 television network and Natseven TV Sdn Bhd, the owner and operator of ntv7 television network in 2005. Channel 9 was re-launched as TV9 on 26 April 2006.
Year 2005 also witnessed MPB's maiden efforts to venture into radio broadcasting through the acquisition of Perintis Layar Sdn Bhd, which holds a 75% stake in Max Airplay Sdn Bhd ("Max"). Max has been awarded the right to manage, operate and maintain a radio station by Malaysia Airports (Sepang) Sdn Bhd. In addition, MPB also acquired Synchrosound Studio Sdn Bhd, a radio broadcasting license holder, during the same year.
3) Who are the substantial shareholders of MPB?
As at 30 December 2010, the substantial shareholders of MPB are as follows:
(i)Employees Provident Fund Board (20.87%)
(ii) Gabungan Kesturi Sdn Bhd (12.22%)
(iii) Altima Inc (8.76%)
(i)Employees Provident Fund Board (20.87%)
(ii) Gabungan Kesturi Sdn Bhd (12.22%)
(iii) Altima Inc (8.76%)
4) Please elaborate on the convertible instruments of MPB.
i) Employee Share Option Scheme ("ESOS")
The scheme was effective for a period of five (5) years and has expired on 10 January 2010.
The scheme was effective for a period of five (5) years and has expired on 10 January 2010.
5) Please elaborate on MPB's borrowings.
As at 31 December 2010, being the latest available date of the quarterly unaudited consolidated results of MPB, the borrowing details are as follows:
|
31.12.2010 |
|
RM'000 |
Bank guaranteed medium term notes ("BGMTN") / Commercial papers ("CP")(i) |
169,257 |
Term loan (ii) |
215,000 |
Bonds with detachable warrants |
145,008 |
Total borrowings as at 31 December 2010 |
529,265 |
Notes:
(i) On 7 September 2007, MPB issued BG MTN amounting to RM170.0 million in nominal value pursuant to the BG MTN Programme. On 12 September 2007, MPB issued CP amounting to RM100.0 million in nominal value pursuant to the CP Programme.
The principal terms of the CP/BG MTN are as follows:
(a) The face value of the CP is RM100 million and the BG MTN is RM170 million;
(b) The CP are issued at a discount to face value and shall be repayable at par;
(c) The interest on the BG MTNs of RM100 million and RM70 million are 4.15% and 4.27% per annum respectively, payable semi-annually in arrears, calculated on the basis of the actual number of days elapsed in a year of 365 days with the last payment of interest to be made on the maturity date of the BG MTNs;
(d) The tenure of the BG MTN is up to 5 years from the date of issue; and
(e) The maturity date of the CP is between one (1) to twelve (12) months up to 7 years.
(ii)Term loans obtained by MPB.
6) What is the status of the acquisitions undertaken in recent years?
(i) Perintis Layar Sdn Bhd ("PLSB")
The acquisition of PLSB was completed on 29 April 2005. The radio station operated by Max Airplay Sdn Bhd, a 75% subsidiary of PLSB, was launched as Fly.fm on 2 October 2005.
(ii) CH-9 Media Sdn Bhd ("Channel 9")
MPB completed the acquisition of 100% of Channel 9 on 23 September 2005. The television station was re-launched as TV9 on 26 April 2006.
(iii) Natseven TV Sdn Bhd ("ntv7") and Synchrosound Studio Sdn Bhd ("Synchro")
The scheme creditors approved the proposed debt restructuring scheme on 27 September 2005 paving the way for the acquisition of ntv7. The acquisition of ntv7 was completed on 30 December 2005. Synchrosound was acquired together with the acquisition of ntv7. The radio station owned by Synchro (previously known as WaFm), had ceased transmission on 1 October 2005. The radio station was re-launched as Hot.fm, a Malay station on 6 February 2006.
(iv) UPD Sdn Bhd ("UPD")
The acquisition of UPD from the Utusan group was completed on 28 February 2007.
(v) The Right Channel Sdn Bhd ("TRC")
On 28 February 2007, MPB completed the acquisition of TRC from the NSTP group.
(vi) Big Tree Outdoor Sdn Bhd ("BTO")
MPB completed the acquisition of BTO on 30 March 2007, a leading outdoor advertising outfit in Malaysia which is planned to spearhead MPB's expansion into the outdoor segment.
(vii) Radio Wanita Sdn Bhd ("RWSB")
MPB completed the acquisition of RWSB on 19 January 2009.
(viii) The New Straits Times NSTP ("NSTP")
On 16 October 2009, MPB announced a conditional take-over offer to acquire all the remaining ordinary shares of RM1.00 each in NSTP not already owned by MPB (“Offer Shares”), at an offer price of RM2.00 per Offer Share, to be satisfied by the issuance of one (1) ordinary share of RM1.00 each in MPB at an issue price of RM2.00 each for every one (1) Offer Share accepted and one (1) free new warrant in MPB for every five (5) Offer Shares accepted (“Original Offer”).
Subsequently on 12 November 2009, MPB announced its intention to revise certain terms of the Original Offer, whereby, the offer price for each Offer Share has been increased from RM2.00 to RM2.40. The Board of MPB has decided to revise the offer price after taking into consideration the views of the various stakeholders of NSTP and prevailing market sentiment.
As at 31 December 2009, MPB held 86.06% of the voting shares in NSTP. The transaction was completed on 4 January 2010. As at the closure date of the transaction, MPB held 89.62% of voting shares in NSTP.
On 28 June 2010, MPB announced an unconditional take-over offer for all the remaining ordinary shares of RM1.00 each in NSTP not already owned by MPB at an offer price of RM2.40 per NSTP share, to be satisfied by the issuance of six (6) ordinary shares of RM1.00 each in MPB at an issue price of RM2.00 each and one (1) free warrant in MPB, for every five (5) NSTP shares accepted. The closing date of the take-over offer was on 14 September 2010.
However, by virtue of a notice to the remaining shareholders of NSTP under Section 223(2) of the Capital Markets and Services Act 2007 issued by MPB on the 21st August 2010, the remaining shareholders now have until 14th December 2010 to serve a notice on MPB to require MPB to acquire the NSTP shares held by them on the same terms as set out in the Offer Document for the Exit Offer dated 16 July 2010 or such other terms as may be agreed by the remaining shareholders and MPB.
As at 30 September 2010, MPB owns 97.87% of voting shares in NSTP.
(ix) Kurnia Outdoor Sdn Bhd and Jupiter Outdoor Networks Sdn Bhd (collectively known as "Kurnia")
On 13 November 2009, MPB announced the acquisition of 100% issued and paid-up capital of Kurnia for an aggregate purchase consideration of RM42.076 million and an additional of up to RM4.291 million which is dependent on the achievement of certain profitability targets for the financial year ended 31 December 2009 and financial years ending 31 December 2010 and 2011. As at 31 December 2009, MPB completed 80% of the transaction. On 19 April 2010, MPB acquired a further 9% stake in Kurnia for the purchase consideration of RM4.1 million and bonus consideration of RM1.8 million for achieving a certain percentage of the agreed profit target of Kurnia for the financial year ended 31 December 2009. As at 30 September 2010, MPB holds 89% equity interest in Kurnia.
The acquisition of PLSB was completed on 29 April 2005. The radio station operated by Max Airplay Sdn Bhd, a 75% subsidiary of PLSB, was launched as Fly.fm on 2 October 2005.
(ii) CH-9 Media Sdn Bhd ("Channel 9")
MPB completed the acquisition of 100% of Channel 9 on 23 September 2005. The television station was re-launched as TV9 on 26 April 2006.
(iii) Natseven TV Sdn Bhd ("ntv7") and Synchrosound Studio Sdn Bhd ("Synchro")
The scheme creditors approved the proposed debt restructuring scheme on 27 September 2005 paving the way for the acquisition of ntv7. The acquisition of ntv7 was completed on 30 December 2005. Synchrosound was acquired together with the acquisition of ntv7. The radio station owned by Synchro (previously known as WaFm), had ceased transmission on 1 October 2005. The radio station was re-launched as Hot.fm, a Malay station on 6 February 2006.
(iv) UPD Sdn Bhd ("UPD")
The acquisition of UPD from the Utusan group was completed on 28 February 2007.
(v) The Right Channel Sdn Bhd ("TRC")
On 28 February 2007, MPB completed the acquisition of TRC from the NSTP group.
(vi) Big Tree Outdoor Sdn Bhd ("BTO")
MPB completed the acquisition of BTO on 30 March 2007, a leading outdoor advertising outfit in Malaysia which is planned to spearhead MPB's expansion into the outdoor segment.
(vii) Radio Wanita Sdn Bhd ("RWSB")
MPB completed the acquisition of RWSB on 19 January 2009.
(viii) The New Straits Times NSTP ("NSTP")
On 16 October 2009, MPB announced a conditional take-over offer to acquire all the remaining ordinary shares of RM1.00 each in NSTP not already owned by MPB (“Offer Shares”), at an offer price of RM2.00 per Offer Share, to be satisfied by the issuance of one (1) ordinary share of RM1.00 each in MPB at an issue price of RM2.00 each for every one (1) Offer Share accepted and one (1) free new warrant in MPB for every five (5) Offer Shares accepted (“Original Offer”).
Subsequently on 12 November 2009, MPB announced its intention to revise certain terms of the Original Offer, whereby, the offer price for each Offer Share has been increased from RM2.00 to RM2.40. The Board of MPB has decided to revise the offer price after taking into consideration the views of the various stakeholders of NSTP and prevailing market sentiment.
As at 31 December 2009, MPB held 86.06% of the voting shares in NSTP. The transaction was completed on 4 January 2010. As at the closure date of the transaction, MPB held 89.62% of voting shares in NSTP.
On 28 June 2010, MPB announced an unconditional take-over offer for all the remaining ordinary shares of RM1.00 each in NSTP not already owned by MPB at an offer price of RM2.40 per NSTP share, to be satisfied by the issuance of six (6) ordinary shares of RM1.00 each in MPB at an issue price of RM2.00 each and one (1) free warrant in MPB, for every five (5) NSTP shares accepted. The closing date of the take-over offer was on 14 September 2010.
However, by virtue of a notice to the remaining shareholders of NSTP under Section 223(2) of the Capital Markets and Services Act 2007 issued by MPB on the 21st August 2010, the remaining shareholders now have until 14th December 2010 to serve a notice on MPB to require MPB to acquire the NSTP shares held by them on the same terms as set out in the Offer Document for the Exit Offer dated 16 July 2010 or such other terms as may be agreed by the remaining shareholders and MPB.
As at 30 September 2010, MPB owns 97.87% of voting shares in NSTP.
(ix) Kurnia Outdoor Sdn Bhd and Jupiter Outdoor Networks Sdn Bhd (collectively known as "Kurnia")
On 13 November 2009, MPB announced the acquisition of 100% issued and paid-up capital of Kurnia for an aggregate purchase consideration of RM42.076 million and an additional of up to RM4.291 million which is dependent on the achievement of certain profitability targets for the financial year ended 31 December 2009 and financial years ending 31 December 2010 and 2011. As at 31 December 2009, MPB completed 80% of the transaction. On 19 April 2010, MPB acquired a further 9% stake in Kurnia for the purchase consideration of RM4.1 million and bonus consideration of RM1.8 million for achieving a certain percentage of the agreed profit target of Kurnia for the financial year ended 31 December 2009. As at 30 September 2010, MPB holds 89% equity interest in Kurnia.
7) How does MPB differentiate its television stations and radio channels from one another?
There are four (4) FTA television stations under MPB's television networks: TV3, 8TV, ntv7, and TV9. TV3 is targeted towards the mass market skewed towards the Malay audience, with progressive mindsets. 8TV targets the young Malaysians, urban and Chinese audience from the 15-24 age group. ntv7 targets the Malaysian urban households from the 24-45 age group, kids & Chinese audience. TV9 is targeted towards the mass market skewed towards the "traditionalist" Malay audience.
There are two (2) radio stations under MPB's radio networks: Fly.fm and Hot.fm. Fly.fm is targeted towards the urban youths from the 18-25 age group and young adults from the 25-35 age group. Hot.fm is targeted at the mass market skewed towards the Malay listeners.
There are two (2) radio stations under MPB's radio networks: Fly.fm and Hot.fm. Fly.fm is targeted towards the urban youths from the 18-25 age group and young adults from the 25-35 age group. Hot.fm is targeted at the mass market skewed towards the Malay listeners.
8) What is MPB's dividend policy?
The Revised Dividend Policy will have a payout ratio ranging from minimum 25% to the maximum of 75% (from previous 20% to maximum 50%) based on:
- PATAMI
- Funding requirement (capital expenditure and investments); and
- Availability of cash flow
- PATAMI
- Funding requirement (capital expenditure and investments); and
- Availability of cash flow
9) Please elaborate on the financial performance of MPB.
MPB, in its efforts to continuously improve its investor relations function, releases a set of presentation materials after the announcement of its quarterly consolidated results to the Exchange. Please refer to these quarterly presentation materials available on pdf. format on MPB’s website here. If you have any further queries, please email us at investors@mediaprima.com.my