Richard Li

Richard Li back in talks to buy paper at cheaper price

PUBLISHED : Wednesday, 07 June, 2006, 12:00am
UPDATED : Wednesday, 07 June, 2006, 12:00am

PCCW chairman Richard Li Tzar-kai has resumed talks to buy the Chinese-language financial daily Hong Kong Economic Journal, with market sources saying the asking price has dropped from $280 million to about $250 million.

The sources said Mr Li had re-entered negotiations with the newspaper's owners, including founder Lam Shan-muk and columnist Cho Chi-ming, after a month's hiatus.

'There is a good chance the parties will reach a final agreement soon. They are discussing details of logistics and operational matters,' one source said.

The asking price of the newspaper was raised from below $200 million to $280 million earlier this year, prompting speculation that Mr Li would quit the negotiations as the market estimated a reasonable range to be between $150 million and $200 million.

However, sources said the current price range on the table was between $240 million and $250 million, with Mr Li being offered the option of taking a stake in the newspaper if he did not buy it outright.

If he does buy the paper, Mr Li has guaranteed that neither he nor his company would interfere in its editorial operation. However, he will have control of the sales and marketing operations.

The newspaper is expected to maintain its editorial direction with independent commentaries. It had earlier been reported that the seller would require the establishment of an editorial committee to oversee the independence of the newsroom to avoid interference from a new owner.

Morris Ho Kwok-fai, a former executive director of Next Media and Sing Tao News Corp, is expected to head the paper's business operation once a deal has been struck.

Mr Li started negotiations in the middle of last year.

Market watchers have raised concerns that by becoming involved in the print media, Mr Li could violate government regulations on cross ownership as his 20 per cent-owned PCCW is the licence holder of pay-television service Now Broadband TV.

There have been calls that he should seek government approval before acquiring another type of media outlet.