KUALA LUMPUR: Utusan Melayu (Malaysia) Bhd faces possible de-listing from Bursa Malaysia amid financial distress coupled with failure to find a white knight.
The news comes after talks that the oldest Malay daily which was established in 1939 as Utusan Melayu with its first publication in Jawi would cease operations this Wednesday after operating for 80 years.
As at June 30 its accumulated losses stand at RM261.61 million.
In a filing to Bursa Malaysia today, it said that based on the current performance of its publishing, distribution and advertising segment, the board is unsure that the group would turn around by the end of financial year 2019.
“Due to the above declining results, the group is experiencing a cash flow constraint and has seriously addressed the issue by intensifying its efforts for the disposal of the properties.
“However, the disposal progress is much affected by the slow market sentiment, restriction and requirement by the relevant authorities and thus the company has not been able to resolve the cash flow issues immediately,” it said.
It also said that it was impossible for the group to convince potential investors to revive the business.
“A few potential identified parties have declined to participate due to the group’s huge liabilities,” it said.
Hence, the group would not be able to meet Bursa Malaysia’s requirement to uplift the Practice Note 17 (PN17) status.
The current situation is prejudicial to Bursa Malaysia Securities Bhd’s rights to proceed to suspend the trading of its shares and to de-list the company in the event it fails to submit its regularisation plan to the authorities today.
Utusan said it was aware that Bursa Securities would take any relevant action including suspending trading of the listed securities on the sixth market day after the date of notification of suspension.
At close today, the share was up one sen to 11 sen with 11,000 shares traded.
The rich history of Utusan started back in Queen Street, Singapore. It was established by Yusof Ishak, who went on to became the first President of Singapore. It then moved its headquarters to Kuala Lumpur after Merdeka in 1958.
In its heyday, the paper’s circulation peaked at 350,000 copies a day in the 1990s and it was one of the largest selling newspapers in the country.
However, it headed south after 2004, when its circulation slipped to 250,000, and further down to 144,438 copies in the first half of 2016.
Utusan has been in the red since 2012, and in August last year, it triggered the PN17 criteria after defaulting on its principal and profit payments to Bank Muamalat Malaysia Bhd and Maybank Islamic Bhd totalling RM1.18 million. - Bernama