Next Media Ltd., controlled by Hong Kong mogul Jimmy Lai, announced the sale of its Taiwan print and television units to two groups of four buyers for NT$17.5 billion ($602 million).
Next Media will sell its Taiwan print assets to four companies, represented by Want Want Chinatimes Group President Tsai Shao-Chung, William Wong of the Formosa Plastics Group, Chinatrust Charity Foundation Chairman Jeffrey Koo Jr. and Lung Yen Life Service Corp. Chairman Li Shih-tsung, according to a filing late yesterday to the Hong Kong stock exchange.
Lai, known for criticizing China’s government, is exiting most of his Taiwan businesses after battling regulators for licenses and distribution rights. The investment by Tsai, son of Want Want China Holdings Ltd. Chairman Tsai Eng-meng, may raise regulatory concerns because Lai’s Apple Daily and the Tsais’ China Times will have a combined newspaper market share exceeding 45 percent.
People are concerned that “someone with so much market share will affect the diversity of Taiwan’s media landscape,” said Lo Shih-hung, associate professor at Taiwan’s National Chung Cheng University’s Department of Communication.
Next Media said yesterday it expects to book a HK$2.28 billion ($295 million) gain on the disposals, and plans to distribute some of the proceeds as dividends. The shares were unchanged at HK$1.59 as of 10:41 a.m.
“Jimmy Lai might have sold his Taiwan print unit to ditch the burden of a business that has been losing money and to boost his company’s share price,” said Lo.
Next will dispose of the print business for NT$16 billion, with Wong’s company taking a 34 percent stake, Tsai’s 32 percent, Koo’s 20 percent and a company controlled by Li Shih-tsung 14 percent.
Neither Tsai, nor the previously disclosed chairman of Taiwan Fire & Marine Insurance Co., Lee Tai-hung, were identified as members of the group that will buy Next Media’s television business in Taiwan for NT$1.5 billion.
Instead, a company represented by William Wong will take a 34 percent stake; Taiwan-incorporated Yong Sin Development Co. represented by Li Jiang-Cheng will take 32 percent; Koo’s company 20 percent; and a company controlled by Li Shih-tsung 14 percent.
Next Media booked two annual losses due in part to its Taiwan television and multimedia unit. It said on Nov. 30 that losses for the six months ended Sept. 30 widened to HK$933.2 million from HK$324.3 million a year earlier.
Next Media’s Taiwan operations accounted for 42 percent of its sales for the year ended March 2012, making the island its second-biggest market after Hong Kong.