SCMP Group announces share buy-back plan

SCMP Group, publisher of the South China Morning Post, has proposed a share buy-back which, if implemented, could lead to the delisting of the firm from the local stock market, according to an announcement on the stock exchange website yesterday.

The company said the buy-back offer could resolve the public float issue that led the company to suspend trading in its shares in Hong Kong in February last year. The proposal requires regulatory approval and shareholders will be allowed to vote for or against it.

"In spite of the current trading status, it remains business as usual for the SCMP Group. Our underlying business is strong, our global readership is rising and our growth thrust initiatives are bearing fruit," said Robin Hu, chief executive of the SCMP Group. "Our objective is to effectively resolve the public float situation, and we are constantly reviewing all viable options to address this. At present, the share buy-back proposal is the identified viable route, though it must be stressed that it is still at a preliminary stage, and is subject to clearance by relevant regulatory bodies."

"Our top priority will always be to protect the interests of our shareholders, including minority shareholders," he added.

Shares of the SCMP Group were suspended on February 26, 2013 after the proportion of stock held by independent shareholders fell to 10.59 per cent of the total shares issued. Hong Kong listing rules require listed companies to have a public float of at least 25 per cent of issued shares. Falling below that requires trading to be halted until the minimum public float is restored.

The SCMP Group statement said it had identified three possible options to resolve the issue.