Alibaba buys SCMP for $266 million

Overview:

• Alibaba—the large Chinese NYSE listed e-commerce company—has agreed to buy the South China Morning Post and SCMP Group’s other media assets for $266 million.
• Alibaba Group Holding will acquire the media business of SCMP Group through its subsidiary Alibaba Investment subject to SCMP shareholders’ approval in light of its very substantial disposal under listing rules.
• SCMP Group’s media assets up for sale include the flagship South China Morning Post newspaper, as well as the magazine, recruitment, outdoor media, events and conferences, education and digital media businesses. Apart from the broadsheet, other SCMP titles include the Sunday Morning Post, its digital platform SCMP.com and related mobile apps, and the two Chinese websites Nanzao.com and Nanzaozhinan.com. The sale will also include a portfolio of magazine titles such as HK Magazine and the Hong Kong editions of Esquire, Elle, Cosmopolitan, The Peak and Harper’s Bazaar.
• Uncertainty in the future of traditional publishing was cited as a key reason for the sale under SCMP Group’s filing to the Hong Kong stock exchange, and following the sale, SCMP will continue to be listed on the HKSE with a focus on property investment.
• First published in 1903, the broadsheet is among the leading English-language newspapers in Asia. It was first listed on the HKSE in 1971 and was taken private by Rupert Murdoch’s News Corporation in 1987 before being relisted in 1990. In 1993, Malaysian Chinese billionaire Robert Kuok’s Kerry Media acquired a controlling interest in the SCMP.
• Norton Rose Fulbright—led by Hong Kong partner Jon Perry—advised SCMP Group.
• Slaughter and May partners Benita Yu and Clara Choi led the team for Alibaba Group Holding.
• Davis Polk & Wardwell acted for Kuok’s Kerry Media.