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SPH AlphaOne To Sell Entire TOM OMG Stake (ST)

BackMay 14, 2009


By Elizabeth Wilmot
The Straits Times

 

SINGAPORE Press Holdings' (SPH) subsidiary SPH AlphaOne is to sell its entire 35 per cent stake in China's leading owner of advertising billboards, Tom Outdoor Media Group (OMG).

SPH disclosed yesterday that the shares would be sold to Tom Outdoor Media Holdings for HK$60 million (S$11.3 million) in cash.

SPH originally invested US$26 million (S$38 million) in the share purchase in early 2006.

Hong Kong-based Tom OMG is a subsidiary of the Tom Group - which is controlled by Hong Kong's richest man, Li Ka-shing - and has an advertising presence in more than 60 major cities in mainland China.

The Tom OMG investment was considered as SPH's first major foray into the mainland market.

According to the official statement, the divestment move took into account 'the financial performance and future prospects of Tom OMG'.

Tom OMG incurred an audited consolidated loss after taxation of HK$13 million for the year ended Dec 31, 2007.

And its unaudited consolidated loss after taxation for the following year ended Dec 31, 2008 soared to HK$102 million.

SPH said that the transaction was not expected to have any impact on its earnings and net tangible assets per share for its current financial year ending Aug 31.

SPH chief executive Alan Chan, who is also a director of Tom OMG, will relinquish that position once the deal is completed.

SPH shares rose two cents to close at $2.95 yesterday.