MCA sells Nanyang stake to Sin Chew boss
Malaysiakini
Oct  17, 2006
Bede Hong and Kuek Ser Kuang Keng

Ezywood Options Sdn Bhd, a previously unknown company, has today been suddenly catapulted into a major player in the Chinese media industry.

MCA, confirming months of speculation, has decided to sell off 21.02 percent of its controlling 44.4 percent stake in Nanyang Press Holdings - the owner of Chinese dailies Nanyang Siang Pau and China Press - to Ezywood for RM64.7 million.

Not much is known about Ezywood apart from the fact that Sarawak timber tycoon and media baron Tiong Hiew King is one of its directors.

The purchase increases Tiong's stake in Nanyang from 23.74 percent to 44.76 percent.

Bursa Malaysia said in a statement that Ezywood will be required to extend a mandatory takeover offer on the remaining Nanyang shares not owned by the company.

A search in the Malaysia Companies Commission showed that Ezywood was a nominal company registered in Jan 20, 2003 and remained dormant till now.

Tiong, his son Tiong Chiong En and another relative, Tiong Chiong Yong, are the directors of the company.

With the new acquisition, Tiong cements his reputation as the dominant media player in Malaysia with a near monopoly of the country's Chinese-language press.

He currently owns Sin Chew Media Corporation Bhd, which publishes two top newspapers, Sin Chew Daily and Guangming Daily.

Of the six major Chinese newspapers, Oriental Daily and Penang-based Kwong Wah Daily are the only two other Chinese newspapers not under Tiong's control.

Right time to sell

At a party central committee meeting today, MCA gave the green light to its investment arm Huaren Holdings to sell almost half of its share to Ezywood.

Party president Ong Ka Ting said the decision to sell the shares was made by the board of Huaren Holdings.

"The MCA central committee felt that the decision was solely based on commercial considerations, and took note that the board will do whatever necessary to complete the said sale, and to make the announcement when appropriate," he said after a four-hour meeting.

He side-stepped all queries on whether the party leadership had any influence in the sale. Party treasurer Lau Yin Pin is also the chairman of the Huaren Holdings board.

"Certain quarters had not wanted us to purchase the newspaper in the first place. The timing is right (to sell)," he added.

He also appeared to distance himself from the party's controversial decision to take over Nanyang five years ago.

"The CC (central committee) had given the mandate to the board when the purchase was made in 2001. It's not appropriate for us to speak for the board," he told reporters.

MCA bought Nanyang shares for RM5.50 per share in 2001 but they are selling part of the stake to Tiong at RM4.20 per share, making a loss of RM3.07 million.

Earlier, Ong had also gave a special briefing to about 700 party leaders at MCA headquarters in Kuala Lumpur.

While he refused to reveal what had transpired at the meeting, it is learnt that he spoke on current issues including the debate on bumiputera equity.

He also reassured party leaders that he had stated the stand of the Chinese community in the cabinet.

He also announced that the central committee has in principle agreed to defering the party polls after the next general election.

Books in red

Nanyang’s financial situation has not been healthy in recent years. It suffered RM6.3 million losses in its last financial year ending on June 30, 2006. It was also the first time Nanyang suffered losses after being taken over by MCA.

The increasing losses of Nanyang is said to be the key factor that contributed to the sale of the shares by MCA. The party desperately wanted a way out of the ailing newspaper as the daily was seen as losing credibility under the control of the political party.

MCA’s investment arm Huaren Holdings took over Nanyang Press despite strong public protests against the much maligned RM230 million deal in 2001.

Following MCA’s takeover, Tiong’s name was also dragged into the controversy after it was rumoured that Sin Chew had a hand in the episode.

Despite the tycoon’s denial, about 100 columnists stopped writing for Sin Chew Daily (then known as Sin Chew Jit Poh) and Guangming in protest.

The speculation that Sin Chew will eventually acquire Nanyang from MCA became rife again after former Sin Chew Media Corporation Bhd executive director Gan Chin Kew was appointed as the new group managing director/group chief executive officer of Nanyang in May.

Commenting on these developments, Chinese media activist and association leaders said that Tiong could have felt the time was ripe now for him to make the move to buy a controlling stake.