Vogue printer to build plant in Shanghai joint venture

PUBLISHED : Friday, 22 July, 2005, 12:00am
UPDATED : Friday, 22 July, 2005, 12:00am

Hong Kong-listed SNP Leefung Holdings, which holds the contract to print the Chinese edition of Vogue magazine, plans to invest tens of millions of dollars in a new joint venture printing operation in Shanghai.

The women's magazine will be launched in China in September with a target circulation of 300,000 per month, the printing firm's chief executive, Yeo Chee Tong, said.

Vogue would rank among SNP Leefung's five biggest mainland clients by sales, he added.

'Vogue is the driver for the Shanghai plant as we wouldn't have enough printing capacity otherwise.'

SNP Leefung is in talks with 'a well-known state-owned Chinese conglomerate with businesses in media and property' to establish the Shanghai printing joint venture, according to Mr Yeo.

It will own 49 per cent of the venture as Chinese law forbids foreign ownership of 50 per cent or more in publishing operations.

SNP Leefung raised about $120 million from a rights issue last month, most of which would be used to finance the Shanghai printing plant, Mr Yeo said.

The plant will start operations next year and will generate $80 million per year in revenue.

SNP Leefung's mainland business is printing magazines, which generated turnover of $177 million in the first half of this year.

The firm's interim turnover jumped 84.7 per cent to $703.2 million, while net profits increased 88.6 per cent to $30.17 million.

'Our revenue growth in the first half was driven by mergers and acquisitions,' Mr Yeo said.

In the past year, SNP has bought two book firms from its Singapore parent, SNP Corp, for S$88 million ($404.6 million), and paid $68.4 million for 60 per cent of packaging firm Yau Yue Paper Products.