Friday 29 Mar 2024
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KUALA LUMPUR: Star Publications (M) Bhd said it is acquiring the entire stake in a dormant company — which will own US exhibition assets — to diversify its income source, confirming a report in The Edge Financial Daily last month that Star was eyeing a US-based exhibition asset.

The daily, quoting sources, reported that Star could be in talks to acquire an American asset that was complementary to the group’s current businesses.

In a Bursa Malaysia filing yesterday, Star (fundamental: 2.5; valuation: 1.2) said Singapore-listed unit Cityneon Holdings Ltd, in which it indirectly owns 64.1%, 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 (Cityneon) 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,” said Cityneon in an announcement attached with the filing.

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 the completion of the acquisition, VHE will own and operate the assets of US-based Victory Hill Exhibitions LLC. Victory Hill Exhibitions is an exhibition services provider. It has an agreement with Marvel Characters BV to provide exhibition services for Marvel.

Star said the proposed acquisition is in the best interest of the group. Its shares settled three sen or 1.24% higher at RM2.45 with a market capitalisation of RM1.8 billion.


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. Go to www.theedgemarkets.com for more details on a company’s financial dashboard.

 

This article first appeared in The Edge Financial Daily, on April 3, 2015.

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