DESPITE a positive lift in Ming Pao's share price yesterday, the newspaper's looming change of ownership still clouded its future and analysts were reluctant to make strong recommendations. Ming Pao's shares rose 15 cents to $3.80, with analysts saying the sale price of $3.85 offered by Malaysian tycoon Tiong Hiew King was generous. They generally expected the selling price to be between $3.50 and $3.60. They agreed Ming Pao's good reputation and potential in Canada merited a good price but expressed reservations about loans which had raised auditors' eyebrows in the latest annual accounts. UBS Securities research analyst Kauchik Shridharani said the sale price represented a price-earnings multiple of 10, a similar ratio to that offered by other media stocks. Given the high net debt to equity ratio and the problematic loans, he did not think the price justified the additional risk. 'The gearing ratio is 100 per cent, taking away the valuation of its title, which none of the other newspapers does, and adjusting the valuation of its Chai Wan property,' Mr Shridharani said. Ming Pao valued its title at $150 million and its 18-month valuation of the Chai Wan property stood at $580 million. Mr Shridharani said a present-day valuation could knock as much as 40 per cent off the property's worth. The latest Ming Pao annual report stated a 55.36 per cent debt-to-equity ratio, but Mr Shridharani said he based his calculation on tangible equity. Oriental Press commanded a multiple of 12.5 but carried a much stronger growth potential and a lower gearing, he said. He advised investors to sell Ming Pao in light of limited potential in the coming six to eight months. 'There may be potential synergies as the new owner has solid experience in turning around Chinese newspapers in Malaysia,' he said. A Standard Chartered Securities analyst suggested small shareholders take advantage of the general offer to leave the scene. Although the sale would divorce Ming Pao from CIM, separating the company from the troubles which had tarnished its reputation recently, other uncertainties had set in. These included the future direction of the paper under a new owner whose management style and background were unclear, and the recoverability of the $300 million in loans. Whether CIM would continue to provide guarantees for the loans had not been clarified. One analyst said: 'Besides, the operating environment of the newspaper industry is getting tougher. 'Ming Pao's profit won't be raised too high.' Mr Tiong will acquire a 35.9 per cent stake from former chairman Yu Pun-hoi for $493.1 million, lifting his stake to 46 per cent. A general offer will ensue but both Louis Cha, who holds 10.9 per cent of Ming Pao, and Oei Hong Leong, who holds 11.3 per cent, have undertaken not to accept the offer.