Xinhua Finance Media Acquires Company to Expand Radio Advertising Network and the Scope of Its Advertising Services
12 June 2007 - 12:24AM
PR Newswire (US)
BEIJING, June 11 /Xinhua-PRNewswire-FirstCall/ -- Xinhua Finance
Media ('XFMedia'; Nasdaq: XFML), China's leading diversified
financial and entertainment media company, today announced it has
signed an agreement to acquire a 100% interest in Singshine
(Holdings) Hongkong Limited ('Singshine'). The acquisition will
expand the geographic coverage of XFMedia's radio program
consultation and advertising capabilities from northern to southern
China and add entertainment and high-end consumer- oriented
advertising to XFMedia's current range of financial and corporate
focused advertising. Singshine conducts its business in China
through its subsidiaries and affiliated entities. Founded in 1998,
Singshine Communication Co. ('SSC') specializes in radio program
consultation and sales management. SSC has exclusive contracts with
various Guangdong radio channels for radio program consultation and
advertising sales management, with programming targeted at
high-income private vehicle owners primarily between the age of 25
and 48. Also founded in 1998, Singshine Marketing Service Co.
('SSMS') is an advertising services agency providing below-the-line
solutions from planning to execution of nationwide promotional
campaigns. These services include 'person-to-person" marketing for
clients' promotional events at shopping centers, clubs and other
entertainment outlets. SSMS serves many international brands
including Johnnie Walker, P&G, Motorola, Sony, Budweiser and
Philips. SSMS also provides campus marketing services that help
clients to reach and understand college students as well as to
establish and promote their brands within a 60-university network
across China. XFMedia CEO Fredy Bush said, 'The integration of the
Singshine businesses will extend the reach of our radio advertising
and consultation services, which currently serve Shanghai and
Beijing, to Guangdong province, which is an important region in
China with a significant population of well-educated and upwardly
mobile residents. We believe that by expanding our reach into
southern China, this acquisition represents an important step in
strengthening XFMedia's advertising platform and targeting high-net
worth individuals across China.' The National Bureau of Statistics
of China reported that the total population in Guangdong province
as of 2005 was approximately 92 million. More than 6 million
residents have college and higher levels of education, compared to
4.05 million in Shanghai and 4.80 million in Beijing. According to
CTR Market Research, radio advertising in China grew 24% in 2006,
the fastest of any sector in China's advertising market, with a
total estimated value of US$36.9 billion. A Winterberry Group study
also found that from 2003 to 2007, global below-the-line spending
has grown 7.8%, compared to 5.5% growth in above-the-line spend.
Fredy Bush added, 'The addition of SSMS's advertising services and
events management experience in the entertainment and high-end
consumer products sectors will also complement XFMedia's existing
specialization in the financial and corporate sectors. These
below-the-line advertising capabilities add value to the
advertising solutions we are providing. Our advertisers will now be
able to tie in more promotional opportunities and exposure around
their advertising on print, television and radio.' Singshine CEO Mr
Roger Ho said, 'I am delighted to be part of XFMedia's dynamic,
targeted platform and look forward to the synergies that this
combination will create. I believe Singshine will add depth and
breadth to XFMedia's broadcast and advertising platform and at the
same time provide an opportunity for Singshine to further expand
its market share in China.' Mr. Ho and other key management have
signed employment contracts and will remain with the company. The
transaction is expected to close on or prior to 15th June 2007.
Under the agreement, XFMedia will acquire control of SSC and SSMS
through the purchase of 100% of the shares of Singshine (Holdings)
Hongkong Limited, a company which conducts Singshine's business
through its wholly owned subsidiary and affiliated entities in
China ('Singshine'). XFMedia will pay approximately US$7.9 million
in cash and issue 50,000 XFMedia common shares (currently equal to
25,000 XFMedia ADSs) to the vendors at the closing. The vendors may
be entitled to receive a further 50,000 XFMedia shares within one
year of completion, and may also be entitled to receive certain
cash earnout payments depending on Singshine's 2007, 2008 and 2009
financial performance. The transaction is expected to be accretive
to XFMedia's earnings per share in 2007. About Xinhua Finance Media
Limited Xinhua Finance Media ('XFMedia'; Nasdaq: XFML) is China's
leading diversified financial and entertainment media company
targeting high net worth individuals nationwide. The company
reaches its target audience via TV, radio, newspapers, magazines
and other distribution channels. Through its five synergistic
business groups, Advertising, Broadcast, Print, Production and
Research, XFMedia offers a total solution empowering clients at
every stage of the media process and keeping people connected and
entertained. Headquartered in Beijing, the company has offices and
affiliates in major cities of China including Beijing, Shanghai,
Guangzhou, Shenzhen and Hong Kong. For more information, please
visit http://www.xinhuafinancemedia.com/ . Xinhua Finance Media is
a subsidiary of Xinhua Finance Limited ('XFL'; TSE Mothers: 9399),
China's premier financial information and media service provider.
XFL owns 36.9% of the equity and 85.4% of the voting rights of
XFMedia through its holding of class B common shares, which have
ten votes per share. The investing public, the company's China
partners, executives and staff own class A common shares in the
company with one vote per share. The dual-class common share
structure was created to accommodate the regulatory landscape of
China's media sector. Safe Harbor Statement This announcement
contains forward-looking statements. These statements are made
under the "safe harbor" provisions of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements can
be identified by terminology such as "will," "expects,"
"anticipates," "future," "intends," "plans," "believes,"
"estimates," 'confident' and similar statements. Among other
things, quotations from management in this announcement contain
forward-looking statements. XFMedia may also make written or oral
forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission on forms 20-F and 6-K, etc., in
its annual report to shareholders, in press releases and other
written materials and in oral statements made by its officers,
directors or employees to third parties. Statements that are not
historical facts, including statements about XFMedia's beliefs and
expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties that could
cause actual results to differ materially from those contained in
any forward-looking statements. Potential risks and uncertainties
are risks include but are not limited to, the risk that the
transaction may not close when expected or at all, the China
advertising market may not grow as expected and other risks,
outlined in XFMedia's filings with the U.S. Securities and Exchange
Commission, including its registration statement on Form F-1. All
information provided in this press release is as of the date of
this release, and XFMedia undertakes no duty to update such
information, except as required under applicable law. For more
information: China Xinhua Finance Media Ms. Joy Tsang Tel:
+86-21-6113-5999 Email: United States Taylor Rafferty John
Dudzinsky Tel: +1-212-889-4350 Email: DATASOURCE: Xinhua Finance
Media CONTACT: China -- Ms. Joy Tsang of Xinhua Finance Media,
+86-21-6113- 5999, or ; or United States -- John Dudzinsky of
Taylor Rafferty, +1-212-889-4350, or Web Site:
http://www.xinhuafinancemedia.com/
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