Star Media Group Berhad

[Dividend Warrior]

An interesting read......

http://www.cnbc.com/id/101119942

[CityFarmer]

An interesting read......

http://www.cnbc.com/id/101119942

I am doing a research on Star Publications (M) Bhd, the owner of The Star. It seems an interesting company, which able to sustain its readership, and advertising revenue. Its balance sheet is healthy.

The success might be due to its marketing strategy, a "buffet" and "value-for-money" paper, or its unique position in M'sia, as "people" paper that spoke their language.

[opmi]

An interesting read......

http://www.cnbc.com/id/101119942

I am doing a research on Star Publications (M) Bhd, the owner of The Star. It seems an interesting company, which able to sustain its readership, and advertising revenue. Its balance sheet is healthy.

The success might be due to its marketing strategy, a "buffet" and "value-for-money" paper, or its unique position in M'sia, as "people" paper that spoke their language.

some thots.

My guess...with the English standard of Malaysia dropping, readers will get lesser...

and the usual problem of internet on newspapers....

not interesting unless Star owns a big piece of land along bukit bintang...

BUT value is found when most people skipped the stock based on preceptions/assumptions.

[bran]

Interesting company indeed. However, the Star is owned by MCA and politically, it appears the chinese has given up on the MCA in Malaysia. Will they treat the Star as MCA's voicebox and not read it?
Probably have to look into their readership trends esp since the elections to have some visibility
balance sheet looks clean and it doesnt look especially expensive though.

An interesting read......

http://www.cnbc.com/id/101119942

I am doing a research on Star Publications (M) Bhd, the owner of The Star. It seems an interesting company, which able to sustain its readership, and advertising revenue. Its balance sheet is healthy.

The success might be due to its marketing strategy, a "buffet" and "value-for-money" paper, or its unique position in M'sia, as "people" paper that spoke their language.

[weijian]

Minorities in Star Media Group have Tong (no outsider to VBs since he controls SGX-listed Avarga) to safeguard their rights. But it reminds to be seen if Tong's 5% can make Star Media become SPH...

After all, been branded irrelevant by the Malaysia Chinese since 2008, MCA has to continue to use its financial clout (not political) to preserve its patronage system.

Patronage is real and alive in Msia.

Tong's Portfolio: Share investors like outcome of Star Media Group’s EGM

STAR Media Group held its extraordinary general meeting (EGM) as scheduled on May 31. The resolution on the disposal of properties — two units of double-storey semi-detached factory and warehouse annexed with a 1½-storey office building plus other ancillary buildings — to Matang (0.09 -0.005) in exchange for a 13% stake in the latter (plusRM4.1million cash for a total consideration of RM33 million) was voted down by the majority shareholdings.

More importantly, our contention is not limited to this one particular related-party transaction between Star and Matang (0.09 -0.005), but something more holistic. Star has a big cash pile and valuable land, but its valuations are being weighted down by the media business, which is suffering due to continued tech disruption. The company is trying to turn the media business around, and it is the expert in this industry. We hope it succeeds. What we question is Star’s strategy to diversify into property development and plantation, businesses in which it has little to no experience.

There is a reason why conglomerates typically trade at a discount to their sum-ofparts. Let’s be honest, not everyone can be Warren Buffett, the legendary investor who has built a hugely successful conglomerate for the past six decades.

Last week, we gave the example of how Singapore Press Holdings (SPH) has successfully monetised its assets AND enhanced value for all of its shareholders — by privatising the media business and selling its real estate to the highest bidder. All proceeds were then returned to shareholders. Shareholders can reinvest their money in “best-in-kind” companies, in whichever sector and industry they prefer, to obtain the best possible outcomes. This is how the company can create value for its shareholders.

Yeow suggested potential synergy between Star and Matang (0.09 -0.005). To quote him, “On the corporate level, MCA has a controlling stake in Matang (0.09 -0.005). So combining MCA and Star Media [stakes], the synergy as with the alignment of any corporate decision will be simpler, because we do share a common shareholder. That will help decision-making. Star Media has significantly larger back-office management resources, such as shared services, finance and legal and so on, which could complement Matang (0.09 -0.005).”

If the transaction had gone through, Star would have a 13% stake in Matang (0.09 -0.005) — an “investment holding” stake. What justification is there for Star to utilise its resources to support Matang (0.09 -0.005) and/or further the interests of their common shareholder, MCA?

In fact, did Yeow inadvertently tell us of grander plans in the works for Star and Matang (0.09 -0.005)? Is the 13% stake simply the first step to consolidating Matang (0.09 -0.005)’s plantation business into Star? Is it the planned next step for Star to buy MCA’s 17.2% holding in Matang (0.09 -0.005) and then go on to make a general offer for all remaining Matang (0.09 -0.005) shares?

If so, this would effectively see the transfer of Star’s cash to Matang (0.09 -0.005) and its shareholders — at the expense of Star and its minority shareholders. Is Star “bailing out” MCA (and some of its members) by buying Matang (0.09 -0.005) shares that are going nowhere? It is trading well below the IPO price of 13 sen

https://www.pickastock.info/news?id=2521...roup-s-EGM

[Shiyi]

Minorities in Star Media Group have Tong (no outsider to VBs since he controls SGX-listed Avarga) to safeguard their rights. But it reminds to be seen if Tong's 5% can make Star Media become SPH...

After all, been branded irrelevant by the Malaysia Chinese since 2008, MCA has to continue to use its financial clout (not political) to preserve its patronage system.

Patronage is real and alive in Msia.

Tong's Portfolio: Share investors like outcome of Star Media Group’s EGM

STAR Media Group held its extraordinary general meeting (EGM) as scheduled on May 31. The resolution on the disposal of properties — two units of double-storey semi-detached factory and warehouse annexed with a 1½-storey office building plus other ancillary buildings — to Matang (0.09 -0.005) in exchange for a 13% stake in the latter (plusRM4.1million cash for a total consideration of RM33 million) was voted down by the majority shareholdings.

More importantly, our contention is not limited to this one particular related-party transaction between Star and Matang (0.09 -0.005), but something more holistic. Star has a big cash pile and valuable land, but its valuations are being weighted down by the media business, which is suffering due to continued tech disruption. The company is trying to turn the media business around, and it is the expert in this industry. We hope it succeeds. What we question is Star’s strategy to diversify into property development and plantation, businesses in which it has little to no experience.

There is a reason why conglomerates typically trade at a discount to their sum-ofparts. Let’s be honest, not everyone can be Warren Buffett, the legendary investor who has built a hugely successful conglomerate for the past six decades.

Last week, we gave the example of how Singapore Press Holdings (SPH) has successfully monetised its assets AND enhanced value for all of its shareholders — by privatising the media business and selling its real estate to the highest bidder. All proceeds were then returned to shareholders. Shareholders can reinvest their money in “best-in-kind” companies, in whichever sector and industry they prefer, to obtain the best possible outcomes. This is how the company can create value for its shareholders.

Yeow suggested potential synergy between Star and Matang (0.09 -0.005). To quote him, “On the corporate level, MCA has a controlling stake in Matang (0.09 -0.005). So combining MCA and Star Media [stakes], the synergy as with the alignment of any corporate decision will be simpler, because we do share a common shareholder. That will help decision-making. Star Media has significantly larger back-office management resources, such as shared services, finance and legal and so on, which could complement Matang (0.09 -0.005).”

If the transaction had gone through, Star would have a 13% stake in Matang (0.09 -0.005) — an “investment holding” stake. What justification is there for Star to utilise its resources to support Matang (0.09 -0.005) and/or further the interests of their common shareholder, MCA?

In fact, did Yeow inadvertently tell us of grander plans in the works for Star and Matang (0.09 -0.005)? Is the 13% stake simply the first step to consolidating Matang (0.09 -0.005)’s plantation business into Star? Is it the planned next step for Star to buy MCA’s 17.2% holding in Matang (0.09 -0.005) and then go on to make a general offer for all remaining Matang (0.09 -0.005) shares?

If so, this would effectively see the transfer of Star’s cash to Matang (0.09 -0.005) and its shareholders — at the expense of Star and its minority shareholders. Is Star “bailing out” MCA (and some of its members) by buying Matang (0.09 -0.005) shares that are going nowhere? It is trading well below the IPO price of 13 sen

https://www.pickastock.info/news?id=2521...roup-s-EGM

Tong has divested his stake in Star Media.

[weijian]

hi shiyi,
I double checked on Bursa Malaysia and saw that he indeed disposed part of his personal stake from 0.254% to 0.2% on 2 occasions (28th and 30th Aug)

28th Aug: https://www.bursamalaysia.com/market_inf...id=3380277
30th Aug: https://www.bursamalaysia.com/market_inf...id=3381822

However, he still owns 0.2% directly and 5.174% indirectly (unchanged) through his controlled The Edge Media Group.

25th April acquisition by The Edge Media Group: https://www.bursamalaysia.com/market_inf...id=3346529

[Shiyi]

Thanks Weijian.

My info comes from The Edge Sep 7, 2023 Tong's Portfolio column as follows:

Recall that we bought three stocks with negative enterprise value (market cap is less than net cash) back in mid-April 2023. All three stocks have recorded double-digit gains in the five months since (see Table 3). We have sold KUB and Star Media Group, making profits on both but continue to hold Insas. We think Insas has the best potential to realise its actual underlying value, perhaps sooner rather than later. Although Star has a lot of cash and negative enterprise value, the fear is that its underlying business is performing badly and, thus, will continue to drain cash. The company’s recent decision on property development leaves doubt as to whether the cash will be applied to maximise gains for minority shareholders.

[weijian]

hi shiyi,

Thanks for quoting your source. I am not a subscriber and so not able to check in detail. I also do not follow Towkay Tong in detail (maybe I should).

But my most probable guess is that the portfolio he mentioned is a small compartmentalized subset that he invests/tracks on his column in the magazine. It is still true that he still own >5% based on Bursa Msia announcement. So we can still look forward to more drama in future.