Newspapers, much like mullets, are gone and probably never coming back.
While some older folks still enjoy going through the dailies every morning, most of us have turned to our phones for news, with thousands of articles available at a few taps of our thumbs.
That’s why it was unsurprising when Singapore Press Holdings (SPH) announced in May that it’d be restructuring its media business into a non-profit entity that supports “quality journalism”.
They cited a drop in revenue due to a decline in print media as the main reason for their major restructuring.
Now, however, there may be someone who is willing to bail them out.
Keppel’s Offering to Buy Over SPH & Turn it Into a Private Company
Keppel Corporation has offered to buy over and privatise SPH in a S$3.4 billion deal.
As part of the deal, SPH will be delisted and will become a wholly-owned subsidiary of Keppel.
However, the deal can only go through if SPH’s media assets are successfully transferred to a company limited by guarantee, a not-for-profit entity.
And for this to happen, SPH needs the approval of its shareholders, who are expected to discuss the issue at an extraordinary general meeting (EGM) this month or next.
If the restructuring is approved, the transfer will likely be completed by the end of the year.
And if SPH and Keppel’s shareholders approve the buy-out, SPH’s privatisation will take place soon after.
Under Keppel’s proposal, SPH shareholders will receive 66.8 cents in cash per share, 0.596 Keppel Reit units, and 0.782 SPH Reit units per share.
Keppel will also hold a remaining 20% stake each in SPH Reit and Keppel Reit.
A Preferred Solution
Speaking about the deal, SPH said that after carrying out a thorough review of its strategic options, it concluded that Keppel’s proposal would be the preferred solution, as it would maximise value and minimise disruption to shareholders.
“It derives a better valuation outcome for all shareholders where a control premium is paid for the entire company. Also, it avoids a situation where prime SPH assets are cherry-picked, leaving SPH with its existing debt and the risk of being unable to monetise its remaining assets,” SPH said.
SPH received more than one closed bid for a buy-out but said it chose Keppel based on criteria such as price, execution risks, and regulatory approvals.
SPH Recorded Its First-Ever Loss in 2020
Print media had already been on the decline over the last decade or so thanks to the emergence of social media, but for many organisations, COVID-19 was a killer blow.
Last year, SPH recorded its first-ever loss of S$11.4 million for the financial year that ended 31 Aug, 2020.
And if not for the Jobs Support Scheme, the loss would have been a deeper S$39.5 million, SPH said.
SPH had tried to cater to the shift in consumer preference from print to digital media, but to no avail.
As part of its restructuring, all books, newspapers, and magazines under SPH will be transferred to the new, non-profit subsidiary.
This includes The Straits Times and Lianhe Zaobao.
Read Also:
- S’poreans Take Umbrage at SPH CEO’s “Boorish Behaviour”
- Former Minister Khaw Boon Wan to Chair Board of New Not-for-Profit Entity After SPH Media Restructuring
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