Singapore – The Government is prepared to provide funding support to the proposed new not-for-profit media spinoff from Singapore Press Holdings (SPH), said the Ministry of Communications and Information (MCI) on Thursday (May 6).
SPH announced on Thursday (May 6) that the company will be undergoing a restructuring, with its media business changing into a not-for-profit entity.
The plan, pending shareholder approval, is to transform its entire media-related business into a newly incorporated wholly-owned subsidiary called SPH Media Holdings, according to an SPH media release.
SPH will provide the initial resources and funding for SPH Media, such as a cash injection of S$80 million, S$30 million of SPH shares and SPH REIT units, and SPH’s stakes in four of its digital media investments.
Eventually, SPH Media will be transferred to a not-for-profit entity for “nil or nominal consideration”. The new entity will be a public company limited by guarantee (CLG).
“It is in the interest of Singapore and Singaporeans that our local media continues to thrive and deliver quality journalism,” said MCI in a media release.
“After SPH Media is transferred to a CLG, MCI is prepared to provide it with funding support to help it build capabilities for the future.”
SPH is a main board-listed company incorporated in 1984. Its core business is in the publishing of newspapers, magazines and books in both print and digital editions. The Straits Times as well as dailies in Chinese, Malay and Tamil are published by SPH.
On the property front, SPH owns 66 per cent of SPH REIT, whose portfolio comprises three properties in Singapore, namely Paragon, The Clementi Mall and The Rail Mall. SPH owns and operates The Seletar Mall and is coming up with an integrated development consisting of The Woodleigh Residences and The Woodleigh Mall.
SPH also has businesses in Australia, the United Kingdom and Germany.
According to MCI, the profit margins of SPH’s media business have narrowed considerably over the years.
Having a “professional, capable and respected local news media” is critical to Singapore’s national interest, said Minister for Communications and Information S Iswaran.
“They report through a Singaporean lens so that our citizens have a good understanding of the opportunities and challenges facing our country, the choices we need to make, and our place in the world.
“The Government, therefore, supports high quality, credible journalism in our local news media.”
The minister noted that it is their goal to help the local news media and Singapore’s journalists adapt and thrive in the digital era while maintaining the high professional standards we expect and value.
“The Government is also prepared to provide SPH Media with funding support, with fiscal discipline and accountability for outcomes in areas like digital innovation and capability development, as part of a long-term sustainable business plan,” said Mr Iswaran.
He will be issuing a ministerial statement on the restructuring when Parliament sits on May 10./TISG
Read related: SPH records first net loss of S$83.7 million for FY2020 because of Covid-19
SPH records first net loss of S$83.7 million for FY2020 because of Covid-19