Media Prima Bhd. · MYX:MEDIA
Media Prima Bhd — Merger or Acquisition (March 2007)
45 slides from Media Prima Bhd's merger presentation, Mar 28, 2007
Slide 1: Media Prima Berhad Extraordinary General Meeting
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 1 MEDIA PRIMA BERHAD EXTRAORDINARY GENERAL MEETING •PROPOSED ACQUISITION 100% EQUITY INTEREST IN BIG TREE OUTDOOR SDN BHD (“BTO”) FOR AN AGGREGATE PURCHASE CONSIDERATION OF RM140,633,500 (“PROPOSED ACQUISITION”) •PROPOSED DISPOSAL OF PROPERTY BY SISTEM T
Slide 2: Contents
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL CONTENTS 2 Section 1 Proposed Acquisition 1.1 Strategic Direction of MPB’s Outdoor Business 1.2 Proposed Transaction Structure and Value 1.3 Effects of the Proposed Acquisition 1.4 Rationale & Conclusion Section 2 Proposed Disposal 2.1 Background 2.2 Eff
Slide 3: Section 1: Proposed Acquisition
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 3 SECTION 1 PROPOSED ACQUISITION
Slide 4: Industry Background
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL INDUSTRY BACKGROUND 4 • The outdoor business consists mainly of managing, selling and maintaining advertisements from outdoor billboards, transit advertising and indoor retail advertising displays; • The outdoor industry is populated by a few large opera
Slide 5: A Growing Industry
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL A GROWING INDUSTRY 5 Based on Nielsen figures, outdoor industry has been growing in excess of 10% in recent years. This trend is expected to continue in the future. Year 2003 2004 2005 2006 Total ADEX (RM'm) 3,882 4,424 4,562 4,737 Outdoor ADEX (RM'm) 62
Slide 6: Section 1.1 Strategic Direction of MPB's Outdoor Business
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 6 SECTION 1.1 STRATEGIC DIRECTION OF MPB’S OUTDOOR BUSINESS
Slide 7: The Outdoor Business Model
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL THE OUTDOOR BUSINESS MODEL 7 Big Tree is the “anchor” in consolidating outdoor business - managing under performing assets to enhance value Single Marketing Team Anchor entity Consolidated Backroom Operations Synergy with MPB’s other media platforms
Slide 8: Background of BTO
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL BACKGROUND OF BTO 8 Leading • BTO is the leading outdoor advertising outfit in Malaysia. Outdoor • BTO has prominent presence along the expressway, Company transportation hubs and retail and shopping malls. • BTO grew its annual revenue in 2006 in excess
Slide 9: Strong Financial Track Record
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL STRONG FINANCIAL TRACK RECORD 9 • BTO is a profitable entity with stable increase in revenue and profitability • EBITDA margin is in excess of 40% higher than current margin for MPB of 27% for FYE 2006 2006 RM'000 2002 2003 2004 2005 (Unaudited) Paid-up
Slide 10: Protected by Long Term Revenue Base
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 10 PROTECTED BY LONG TERM REVENUE BASE • More than 70% of BTO’s revenue comes from mid to long term concessions, ensuring certainty of revenue stream: Concessionaire Expressway PLUS Expressway Berhad NSE, NKVE and Federal Highway Route 2 ELITE Sdn Bhd EL
Slide 11: BTO Major Highway Concessions
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL BTO MAJOR HIGHWAY CONCESSIONS 11 1. Highways NORTH SOUTH EXPRESSWAY (“NSE”) • The PLUS NSE - at 797km long, it is the nation’s most important transportation link. Main entry and exit points to Malaysia and major market centers. Traffic volume - 566,600 v
Slide 12: BTO Concessions - Transit
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL BTO CONCESSIONS - TRANSIT 12 2. Transportation hubs/transit RAPID KL (Kelana Jaya Line) • Rapid KL serves Klang Valley’s cosmopolitan population • Ridership of 175,000 people per day or 5.43 million monthly with 69% of commuters aged 18-35 years old • Co
Slide 13: BTO Concessions - Retail
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL BTO CONCESSIONS - RETAIL 13 3. Retail • Hold concessions at KLCC, Suria KLCC, KL Convention Centre, Bangsar Shopping Centre, Gurney Plaza, GE Mall • Concession period ranges from 3 to 8 years with options to renew SURIA KLCC • Concourse shopping floors,
Slide 14: Background of UPD
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL BACKGROUND OF UPD 14 One of the largest • UPD was acquired from the Utusan Group outdoor outfit • Registered revenue of RM13m* • Owns over 2,400 active outdoor advertising panels located Owns over 2,400 across the nation, giving wide coverage for adverti
Slide 15: UPD Billboards
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 15 UPD BILLBOARDS
Slide 16: UPD Billboards
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL UPD BILLBOARDS 16
Slide 17: UPD Transit
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 17 UPD TRANSIT
Slide 18: UPD Transit
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL UPD TRANSIT 18
Slide 19: UPD Street Furniture
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 19 UPD STREET FURNITURE
Slide 20: UPD Street Furniture
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL UPD STREET FURNITURE 20
Slide 21: Background of The Right Channel
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL BACKGROUND OF THE RIGHT CHANNEL 21 • TRC is a small outdoor outfit which was acquired from Small outdoor the NSTP Group company • Registered revenue of about RM2m* • TRC owns concession over ERL train Concessions on • Also owns concession on retail adver
Slide 22: TRC Products
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL TRC PRODUCTS 22
Slide 23: Section 1.2 Proposed Transaction Structure and Value
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 23 SECTION 1.2 PROPOSED TRANSACTION STRUCTURE AND VALUE
Slide 24: Proposed Transaction Structure
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL PROPOSED TRANSACTION STRUCTURE 24 The summary of the total transaction is as follows: Existing Shareholders No. of shares % held Purchase Mode of held Consideration Settlement (RM’m) Navis 280,000 56 81.0 MPB Shares Eye Corp 150,000 30 43.4 Cash Minority
Slide 25: Valuation Structure – Acquisition at Highly Attractive Prices
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 25 VALUATION STRUCTURE – ACQUISITION AT HIGHLY ATTRACTIVE PRICES RM million Navis 81.0 EV / EBITDA PER SJ & CIMB 16.2 Company Country (times) (times) EYE 43.4 Purchase consideration 140.6 Seni Jaya Malaysia 1.25 13.89 Equity stake acquired 100% Lamar Adv
Slide 26: Value Enhancing Deal
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL VALUE ENHANCING DEAL 26 Based on 2007 Estimates * ** ** Total *** Total % Outdoor RM'million BTO UPD TRC Outdoor MPB Combined of MPB Revenue 48.8 10.8 2.5 62.1 575.0 637.1 10.8% EBITDA 18.8 4.2 0.8 23.8 177.0 200.8 13.4% * PATAMI 11.3 2.5 0.6 14.3 95.0 1
Slide 27: Earnings Accretive Deal
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL EARNINGS ACCRETIVE DEAL 27 The pro-forma EPS impact of the acquisition of BTO, UPD & TRC to MPB: 2006 2007 Total MPB Post RM 'm MPB MPB Outdoor Acqns Net profit * 80.28 95.00 14.30 109.30 No of shares - Existing** (m) 763.80 763.80 38.57 802.37 No of sha
Slide 28: Potential Impact of FRS3
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL POTENTIAL IMPACT OF FRS3 28 RM million BTO Purchase Consideration 140.6 Net assets* 42.2 Goodwill 98.4 Goodwill in BTO's books from previous acquisitions 9.8 Estimated goodwill (before allocation to intangible assets) 108.2 Estimate % relating to intangi
Slide 29: Section 1.3 Effects of the Proposed Acquisition
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 29 SECTION 1.3 EFFECTS OF THE PROPOSED ACQUISITION
Slide 30: Effects on MPB Shareholding Structure
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL EFFECTS ON MPB SHAREHOLDING STRUCTURE 30 Post issuance of As at 28/02/07 shares No. of No. of shares shares Main Shareholders ‘000 % ‘000 % Employees’ Provident Fund Board 135,037 17.6% 135,037 16.7% Gabungan Kesturi Sdn Bhd 106,704 13.9% 106,704 13.2% H
Slide 31: Proforma Effects of the Proposed Acquisition
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 31 PROFORMA EFFECTS OF THE PROPOSED ACQUISITION As at 31 After Proposed December 2006 Acquisition*** (RM’000) (RM’000) Share capital 763,852 802,423 Share premium 111,678 154,106 Other reserves 29,414 29,414 Accumulated losses (589,564) (589,564) Shareho
Slide 32: Section 1.4 Rationale & Conclusion
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 32 SECTION 1.4 RATIONALE & CONCLUSION
Slide 33: Rationale of Acquisition
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL RATIONALE OF ACQUISITION 33 Complete Media • Acquisition of BTO will complete MPB’s traditional media Platform platform across TV, Print, Radio and now Outdoor Provide • BTO is the leading Outdoor advertising outfit in Malaysia Dominant • Provides the si
Slide 34: Rationale of Acquisition
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL RATIONALE OF ACQUISITION 34 • Strong brand with an accomplished track record in Outdoor Strong brand & business. Management • Comes with a proven and competent Management team which team forms the nucleus to spearhead the execution of MPB’s Outdoor strat
Slide 35: MPB Group Structure – Post Consolidation of Outdoor
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL MPB GROUP STRUCTURE – POST CONSOLIDATION OF OUTDOOR 35 Television Content Events Print Media Radio Outdoor Broadcasting Creation Management 100.0% 100.0% 43.3% 75.0% 100.0% 100% 80% 100.0% 100.0% 100.0% 100% 100% FACT SHEET @ 28/02/07 Share capital Extra
Slide 36: Section 2: Proposed Disposal
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 36 SECTION 2 PROPOSED DISPOSAL
Slide 37: Section 2.1 Background
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 37 SECTION 2.1 BACKGROUND
Slide 38: Details of the Property
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL DETAILS OF THE PROPERTY 38 • The Property was acquired on 1 December 1996 for a total cost of investment of approximately RM74.9 million. • Audited net book value (“NBV”) of the Property as at 31 December 2005 is approximately RM61.9 million. Unaudited N
Slide 39: Section 2.2 Effects of the Proposed Disposal
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 39 SECTION 2.2 EFFECTS OF THE PROPOSED DISPOSAL
Slide 40: Effects of the Proposed Disposal
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL EFFECTS OF THE PROPOSED DISPOSAL 40 RM'm Estimated Purchase Consideration 60.0 a Less: Estimated nbv @ 30.6.07 (59.9) b Estimated expenses (1.4) Reversal of Deferred Tax Assets* (6.8) (68.1) Estimate loss on disposal (8.1) c Other contingencies (2.6) a -
Slide 41: Proposed Dividend
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL PROPOSED DIVIDEND 41 • Proposed first and final dividend of 3.5 sen less tax of 27% for FYE 31 December 2006 (subject to shareholders’ approval at forthcoming AGM). • The proforma calculation for dividend payout and yield for the purpose of illustration:
Slide 42: Section 2.3 Rationale & Conclusion
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 42 SECTION 2.3 RATIONALE & CONCLUSION
Slide 43: Proposed Disposal: Rationale & Conclusion
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 43 PROPOSED DISPOSAL: RATIONALE & CONCLUSION • Low occupancy rate and rental yield; • High maintenance cost, negligible cash inflow from rental; • Opportunity for MPB Group to dispose off an asset which is low- income generating and not in line with the
Slide 44: Q&A Thank You
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 44 Q&A THANK YOU
Slide 45: Forward-looking statements note
PRIVATE & CONFIDENTIAL PRIVATE & CONFIDENTIAL 45 Note: The presentation may contain forward-looking statements which are based on MPB's current expectations, forecasts and assumptions based on management's good faith expectations and belief concerning future developments. In some cases forward-looki
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