Do you believe that? Well try this:
HK MING PAO TO MAKE HK$4.8M PROFIT ON MAGAZINE DEAL
Ming Pao Enterprise Corp. (0685.HK), a major Chinese-language publisher in Hong Kong, said it will make a profit of HK$4.8 million on a joint-venture deal to expand its magazine business and move into mainland China.
Ming Pao in January reorganized its magazine business, which publishes the Ming Pao Weekly, Hi-Tech Weekly, and City’s Children Weekly, so that a unit called Winmax Resources Ltd. became their ultimate holding company. Ming Pao then reached an agreement to sell 40% of that unit to Redgate Media Inc., an outfit run by former executives of Time Warner and Metromedia.
Under the deal, Redgate will buy the 40% interest in Winmax, in exchange for HK$8.92 million in cash and the entire share capital of another company called Media2U (BVI) Co. It owns licenses to sell advertising in mainland China for the Chinese-language editions of four international magazines: Popular Science, Tomorrow’s Technology Today, Digital Camera and Top Gear.
There is something fishy here:
The four magazines mentioned above all have tiny circulations, and are competing in an overcrowded marketplace where most magazines are losing money or bringing in miniscule profits. Furthermore, Red Gate itself is just a middleman: it neither owns the publishing licences (kanhao) needed to publish in China, not does it own the content of the magazines, which it is simply licensing from foreign media companies.
So it’s very nice that someone is making HK$4.8 million out of this deal.