SPH Divests Its 35% Stake In TOM OMG (BT)

BackMay 14, 2009

SPH AlphaOne transfers stake for HK$60m.

By Teh Shi Ning
The Business Times


SINGAPORE Press Holdings (SPH) is divesting its 35 per cent stake in TOM Outdoor Media Group (TOM OMG) for HK$60 million, or about S$11 million.

The media group announced that its wholly owned subsidiary SPH AlphaOne entered into an agreement yesterday to transfer its entire stake in TOM OMG to TOM Outdoor Media Holdings, which owns the remaining 65 per cent.

In March 2006, SPH invested US$26 million to take up its 35 per cent stake in the billboard unit of TOM Group Ltd, a publishing, advertising and Internet company controlled by Hong Kong billionaire Li Ka-shing.

The strategic partnership was SPH's maiden venture into China's outdoor advertising sector aimed at gaining a foothold in that sector.

SPH said yesterday that the consideration of HK$60 million was arrived at on a 'willing buyer willing seller' basis, and took into account the financial performance and future prospects of TOM OMG.

TOM OMG had posted an audited net loss of HK$13 million for the year ended Dec 31, 2007, and an unaudited net loss of HK$102 million for the year ended Dec 31, 2008.

SPH said that the consideration will be fully settled in cash on the date of completion, which is expected to be 14 days from the signing of the agreement.

The company said that the transaction will have no material impact on its earnings, nor on its net tangible assets per share in the financial year ending Aug 31.

SPH's chief executive Alan Chan, who is also a director of TOM OMG, will cease to be a TOM OMG director upon completion of the deal.