Thursday 28 Mar 2024
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KUALA LUMPUR (Apr 2): Star Publications (M) Bhd is acquiring the entire stake in a dormant company, which will own US exhibition assets to diversify the buyer's income source.

In a Bursa Malaysia filing this afternoon, Star (fundamental: 2.5; valuation: 1.2) said its 64.1%-owned Singapore-listed unit Cityneon Holdings Ltd was acquiring Singapore-based Victory Hill Exhibitions Pte Ltd (VHE) from Philadelphia Investments Pte Ltd for S$21 million (RM56.77 million).

"It is in the interest of the company (Star) to expand its businesses overseas to provide additional sources of revenue and diversify the company's existing businesses and geographical risk of the group.

"With the inclusion of the complementary portfolio of assets made pursuant to the asset transfer within the group's business, the group is able to tap into a different area of business while leveraging its current expertise in events and exhibitions," Star said.

Under the sale and purchase agreement between Cityneon and Philadelphia Investments, Cityneon has proposed to undertake a rights issue to partly fund the acquisition of VHE.

VHE is a dormant company. However, upon completion date of the acquisition, VHE will own assets of US-based Victory Hill Exhibitions LLC.

Victory Hill Exhibitions LLC is an exhibition services provider. It entered into a license agreement with Marvel Characters B.V. for the rights to provide exhibition services for Marvel.

Star's announcement today confirmed a report in The Edge Financial Daily (Edge FD) last month that Star was eyeing an US-based exhibition assets.
 
Edge FD, quoting sources, reported that Star could be in talks to acquire an American asset that was complementary to the group’s current businesses.

At 12:30pm today, Star shares settled three sen or 1.2% higher at RM2.45 for a market capitalisation of RM1.81 billion.

A total of 11,000 shares were traded.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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