The Star

The move by tycoon Tan Sri Vincent Tan to consolidate the ownership of Nexnews Bhd under Berjaya Corp Bhd (BCorp) and himself has sparked market talk that a sale of the publisher is in the works.

Market sources said the asking price – RM200mil – for a controlling stake in one of the main English publications in the country might be a little steep at the moment but said this was just the start of negotiations. 

It was believed the consolidation of the Nexnews stake would give Tan better bargaining power when negotiating a sale of the publication to new owners. 

Last Friday, Tan’s core investment holding company BCorp announced it had acquired 35.69% equity interest in Nexnews from Net Edge Online Sdn Bhd and Tong Kooi Ong for RM139.2mil.  

The deal will raise BCorp substantial shareholder Tan’s equity interest to 88.35% in Nexnews. Before the deal, Tan held a 31.7% direct stake. The company will be a 54.6% subsidiary of BCorp after the purchase.  

Tan was Nexnews chairman and Tong deputy chairman before the transaction.  

Nexnews wholly owns Sun Media Corp Sdn Bhd that publishes The Sun and Gentech (M) Sdn Bhd, which holds 50% stake in The Edge Communications Sdn Bhd that publishes The Edge Financial Daily and The Edge Weekly.  

The acquisition does not give BCorp control in The Edge group, in which Tong has the controlling stake.  

Sources said the move to consolidate the ownership of The Sun was done due to political considerations.  

Even though Nexnews’ initial years were fraught with financial strain, the company’s fiscal performance improved steadily over the years on a diet of improved circulation and better advertisement revenue. 

Sources indicated that Tan might prefer to hold on to a small stake in Newnews even if a new buyer were to take control of the company. Market talk is that he would over time trim his shareholding in the company after the entry of the new controlling owner into Nexnews. 

Investment analysts said Tong’s exit would be a loss to The Sun because the management team he brought in seemed to have helped turn around the English daily.