One Media looks north for growth
Magazine group plans to launch two new titles in mainland
Listing candidate One Media Group is banking on revenue growth from its mainland magazine business by launching two new titles, including the mainland edition of its flagship celebrity title Ming Pao Weekly and the United States-based Rolling Stone, in the next few months.
One Media plans to raise between $100 million and $125 million by selling 100 million new shares in an initial public offering at an indicative price range of $1 to $1.25 each. The offer closes next Wednesday, with shares expected to start trading on October 18.
ICEA and CIMB-GK Securities are the joint sponsors of the deal.
Institutional investors had responded well to the 90 per cent tranche, CIMB executive vice-president Alex Lau said.
One Media will use 40 per cent of the proceeds for acquisitions and strategic alliances in its mainland magazine businesses, while $20 million will be used for marketing of the two versions of Ming Pao Weekly and Rolling Stone. The balance has been earmarked for circulated campaigns, repayment of a short-term bank loan and general working capital.
'We expect China to be our main growth driver,' said chief executive Peter Brack, a former Time Warner executive.
The company is also in talks to take other foreign magazine titles to the mainland.
On top of that, One Media is looking to set up cross-selling packages where advertisers can buy space in Hong Kong and mainland magazines.
The mainland accounted for only 6 per cent of its $177 million revenue for the past business year to March when it recorded a profit of $22 million. The bulk - $166 million - came from its Hong Kong business.
One Media was spun off from local newspaper publisher Ming Pao Enterprise Corp when the company merged its three magazines - Ming Pao Weekly, information-technology title Hi Tech Weekly and children's magazine City Children Weekly - with Redgate Media.
Redgate, founded by Mr Brack, publishes the Chinese versions of four foreign titles - Popular Science, Digital Camera, T3: Tomorrow's Technology Today and TopGear.