By Ted Chen ,The China Post
TAIPEI, Taiwan — The bid for the acquisition of Next Media Taiwan (壹傳媒) was halted yesterday, with major stakeholder Want Want China Times Group (旺旺中時集團) pulling out of the deal ahead of the March 27 deadline.
According to reports, on Nov. 27 last year the ailing Next Media and a number of prospective buyers entered an agreement stipulating that the acquisition process would be completed within four months — March 27 of this year. The terms of the deal priced Next Media Taiwan’s print media and television divisions at NT$17.5 billion. Want Want was a major stakeholder in the acquisition bid, along with Chinatrust Financial Holding (中國信託), Formosa Plastics Group (台塑集團) and Lungyen (龍巖). Want Want’s rejection of the deal means a search will start for a shareholder willing to absorb the 32-percent share of the purchase price that Want Want was previously set to cover, according to reports. Reported Cause of Want Want’s Withdrawal
Want Want had experienced difficulties when the National Communications Commission (NCC, 國家通訊傳播委員會) ruled against the company’s bid to acquire China Network Systems (CNS, 中嘉). This may have led to Want Want’s decision, according to reports. Citing the NCC’s enforcement of anti-media monopoly laws, commentators have said that the company chose to terminate the deal instead of face the likelihood of a protracted struggle with regulators.
Formosa Plastics Group, a 34-percent stakeholder in the deal, yesterday declined to comment on Want Want’s withdrawal. However, according to sources close to Formosa Plastics, the company is reluctant to take on the share previously held by Want Want and wishes to distance itself from a deal that has been subject to tremendous public scrutiny.
The Fair Trade Commission (FTC, 公平會) yesterday announced that the deadline for the assessment of Next Media’s proposed bid is set for April 6, and is extendable to May 6 at its discretion. The regulator said that it governs the domain of electronic media, and does not interfere with deals concerning print media, adding that it welcomes new prospective buyers.
The deal will proceed as normal until the expiry date, said the FTC.
Current State of Next Media Next Media is not looking to rush any liquidation of its Taiwan-based divisions in the short term, following a March 20 transfer of NT$575 million from its Hong Kong-based parent company to cover operating capital needs, according to reports. Nonetheless, Next Media has expressed a desire to liquidate its Taiwan divisions over the long term. Similarly, with the deal halted, Next Media may be able to attract higher prices for its lucrative Taiwan-based print division from prospective buyers.
Meanwhile, spurred by news of its ultimate intent to liquidate its Taiwan-based divisions, Next Media Hong Kong’s share prices have nearly doubled since last August’s HK$0.49, closing at HK$1.17 on March 25.