Media Prima buying Rev Asia’s advertising and media biz for RM105m

PETALING JAYA: Media Prima Bhd is acquiring the advertising and internet media businesses of Rev Asia Bhd for RM105 million.

Rev Asia is expected to use about half of the proceeds from the sale to pay out cash dividends to shareholders.

The group told Bursa Malaysia, it had entered into a conditional sale and purchase agreement for the acquisition of the entire stake in Rev Asia Holdings Sdn Bhd, which posted a net profit of RM4.25 million for 2016 with RM27.41 million in net assets.

Media Prima said the acquisition will provide the group an opportunity to solidify its presence in the digital publishing business.

“It will see the group’s digital platform audience reach of up to 10.4 million (5 million pre-acquisition) thus firmly establishing Media Prima as the third largest digital media company in Malaysia after Google and Facebook with 15.7 million and 14.1 million respectively,” it noted.

The acquisition will be financed by internally generated funds, according to Media Prima.

The deal, however, will mean that Rev Asia will have no significant operations after the disposal, and result in the loss of future income for the group, as it is currently a major contributor of revenue and earnings.

Rev Asia, which could be classified as GN2 cash company after the deal, said it endeavours to take the necessary steps to identify new businesses and/or assets that have the requisite track record and future prospects to be acquired.

It will utilise proceeds from the sale to pay out cash dividends to shareholders (RM59 million) and for working capital (RM6.82 million), among others. The estimated one-off gain is expected to be RM53.32 million.