Sydney-based media monitoring firm Isentia has decided to leave the North Asia market by selling its assets, operations, and clients in mainland China, Hong Kong, Taiwan, and South Korea.
From a financial perspective, Isentia's North Asia departure is expected to result in one-off net cash closure costs of AU$3m to AU$4m which will be incurred over the next 12 months, primarily in H1 FY2021. In addition, there may be a non-cash impairment against the carrying value of the North Asian assets which is currently being determined but will not impact existing banking covenants. In FY2020, North Asia is expected to contribute AU$8.7m in revenue and an EBITDA loss of AU$1.3m.
The ASX-listed company says it inked a strategic alliance with Wisers Information Limited, a leading provider of big data smart business intelligence solutions based in Hong Kong. Isentia will work with Wisers to transition clients in Beijing, Shanghai, Hong Kong and Taiwan to ensure that they continue to have access to media intelligence and insights. The alliance allows both parties to explore further opportunities to collaborate across other markets.
Isentia's assets in mainland China date back more than thirty years, as it acquired companies like SinoFile, China Clipping, and China Newswire over the years. And in Hong Kong and Taiwan it acquired a total of three firms in the past decade to boost its operations.
Isentia has also reached agreement to sell its stake in its Korean business to its local partner and will exit this market. Isentia acquired two media monitoring firms in Seoul over the past four years.