Takeover hit by price war
THE cut-throat circulation war among the Chinese-language newspapers has claimed its first casualty.
Yesterday's extraordinary general meetings held by South China Strategic and South China Holdings to discuss the proposal to take over the Express News were adjourned as both companies had second thoughts about the plan amid the newspaper turbulence.
South China Strategic was scheduled to make a proposal to acquire the paper from Artful, a wholly owned subsidiary of South China Holdings, and Easewin, a firm controlled by Robert Ng Hung-sang, at yesterday's meeting.
Both meetings were adjourned by the directors.
Directors of South China Strategic and South China Holdings jointly announced on Monday they were putting on hold South China Strategic's previously announced proposal to takeover the Express News until the circulation brouhaha cooled down.
The price war, which has seen many popular dailies slash their cover prices to as low as $1, has put a spanner in the works for both South China Strategic and South China Holdings.
While some newspapers have held on to their prices, the overall effect on the Chinese-language press has been one of confusion.
Directors of both companies said on Monday they were putting the takeover bid for the Express News on hold because 'it is anticipated that there will be a period of disruption in the newspaper publishing business'.
They said the full implications of the price cuts might not become clear for some time.
The price war started when the Oriental Daily News and the Sing Pao Daily News cut their prices.