MIH, a subsidiary of Naspers (NPSN), announced an investment in a marketing and advertising sales vehicle for print media in China. MIH will take up a minority equity interest of 9.9% in the initial public offering of Beijing Media Corporation Limited (BMC), which will be listed on the main board of the Hong Kong Stock Exchange on 22 December 2004.
The price of the investment will be determined as part of the institutional bookbuild and public offering process leading up to the IPO.
BMC, majority owned by a state-owned enterprise ultimately controlled by the Beijing Municipal Government (BYD), has the exclusive long-term rights to market, distribute and sell advertising in the Beijing Youth Daily newspaper. Editorial functions of the newspaper are excluded and remain with the present owner, BYD.
The Beijing Youth Daily is the second largest newspaper in Beijing by circulation. It addresses an attractive market for advertisers, and ranks first in Beijing by advertising revenue, as well as in the top three in all of China.
While focussed on Beijing, the Beijing Youth Daily is distributed across China. It relies mostly on subscription rather than retail sales.
BMC plans to raise approximately HK$677 million to HK$778 million of new capital in the IPO. These funds are planned to be used to expand and grow the business into an integrated entity, taking advantage of the rapidly growing advertising market in China.
Naspers is currently also an investor in China-based instant messaging company, Tencent (0700.HK).