Deal gives SinoMedia full control of the fast-growing profitable player with diverse media resources
HONG KONG, Nov. 11, 2010 /PRNewswire-Asia/ -- SinoMedia Holding Limited (HKEx stock code: 623), a leading privately-owned media advertising operator in China providing nationwide TV advertising coverage for clients on China Central Television Station and other media advertising resources, today announced that the Group has acquired a combined 55% equity interest in Beijing Taihe Ruishi Culture and Media Company Limited ("Beijing Taihe Ruishi") from Beijing Taihe Ruishi's minority shareholders at an initial consideration of RMB11.82 million in total. The purchase will be satisfied in cash funded by the Group's internal resources.
Upon the completion of the acquisition, Beijing Taihe Ruishi, which operates a nationwide public service advertising broadcast network of over 120 local television channels in China, will become a wholly-owned subsidiary of CTV Golden Bridge. The acquisition not only will help streamline the operations and decision-making process at Beijing Taihe Ruishi, but will also help contribute greater profits to the Group by diversifying its revenue base into local television channels.
The nationwide public service advertising broadcast network provides customers an opportunity to establish their brand and corporate image at lower costs compared with general TV commercials. It has already started making profit contribution to the Group this year, and has potential of expanding its business into other TV commercials than public service advertisements. Also, various plans have already been scheduled to expand its network and genre of programs in the coming years.
Mr. Chen Xin, Chairman of SinoMedia said: "The growth potential and past performance of the national public service advertising broadcast network have given us strong confidence in its future prospect. Upon gaining full ownership of the company, we will take steps to further strengthen its sales force and expand the network to further enhance its profitability. We are confident that all these will help ensure the sustainable growth of SinoMedia while solidifying our leadership position in the industry."
