The consolidation of Media Prima Bhd and the New Straits Times Press (M) Bhd media groups is projected to generate over RM1 billion in annual revenue with a net profit exceeding RM140 million in an exercise that will see the latter taken private.

MPB managing director Amrin Awaluddin said MPB will make a conditional takeover offer to NSTP shareholders by way of a one-for-one share exchange at an issue price of RM2 together with one new warrant in MPB for every five offer shares accepted.

He told a media briefing here today that the offer was undertaken principally to increase MPB's stake in NSTP with the intention of making it a subsidiary. NSTP will also be taken private in due course.

MPB now has a 43.29 percent stake in NSTP.

Both counters have been suspended pending the announcement with MPB last traded at RM1.77 and NSTP at RM2.46.

johan jaafar johan jaaffar media prima group MPB chairperson Johan Jaaffar said: "MPB's current equity stake in NSTP does not permit us to translate our vision to unlock the full potential of both companies and steer them quickly enough in the strategic manner required to take advantage of the opportunities which we come across.

"So, the proposed acquisition is a decisive move to chart our growth strategy."

To finance its working capital and investments, MPB will raise RM150 million via a bond issue attached with 50 million warrants in the enlarged MPB group which are convertible into 50 million shares in the enlarged MPB group.

Additional plans in the future may include the launch of a employee share option scheme (ESOS) for the employees of the enlarged MPB group.

MPB also intends to distribute up to 24.604 million new MPB bonus warrants to its shareholders at an entitlement date of to be determined later.

Controls all free-to-air TV stations

Amrin expressed confidence that NSTP shareholders would decide in favour of the proposal as it presented them with an excellent opportunity to see their investments unlocked and perform to true potential when more advertising based revenue comes in.

Main Board-listed MPB currently also owns a 100 percent equity interest in TV3, 8TV, ntv7 and TV9.

MPB also owns three radio networks, Fly FM, Hot FM and One FM.

Other cross media interests of MPB include content creation, event and talent management.

The group also acquired three outdoor media companies, Big Tree Outdoor Sdn Bhd, UPD Sdn Bhd and The Right Channel Sdn Bhd in March 2007.

The group has started its venture into online and new media platforms, culminating in the successful launch in September 2007 of both its TV Networks internet portals and a new Lifestyle Portal, gua.com.my.

Mahathir briefed on plan

Outside Malaysia, it has a controlling stake in TV3 Network Ltd, Ghana’s leading private television station.

Meanwhile, former prime minister Dr Mahathir Mohamad has no objection over the consolidation of the two Umno-linked media group.

"It's okay. Media Prima people came and briefed me and I think it is okay," he told reporters after officiating the Menara Mustapha Kamal-PJ Trade Centre tonight.

- Bernama