BEIJING - Mobile phone
ring-tone provider Hurray! Holding has announced
it will merge with China's largest private
television program producer Enlight Media to
create the country's largest independent media
content provider.
Under the terms of the
deal, Enlight Media will inject all of its assets
into the NASDAQ-listed Hurray, which will then
change its name to Hurray Enlight Media Group Ltd.
The new company will be 42% owned by
Enlight Media, and its
share could grow up to 65% in
two years if the average share price exceeds
US$8.50 for 60 consecutive trading days. For now,
Enlight shareholders will receive the equivalent
of 15.74 million Hurray! American Depositary
Shares, representing the 42% stake.
Enlight Media's president Wang Changtian
will become president and chief executive officer
of the new company, while Hurray's president Wang
Shaojian will become chief financial officer.
Both sides refused to disclose the deal's
value, but some estimates put it at $160 million.
In recent years, Hurray - like all of
China's wireless value-added service providers -
has strived to reduce reliance on content
providers and telecom operators, such as China
Mobile, which have actively tapped the wireless
sector to compensate for declining revenue from
traditional voice services.
The company
has acquired several music production companies
and game developers in China in hopes of boosting
diminishing revenues.
After the deal,
Hurray's business in music, games and Internet and
wireless channels will be incorporated with
Enlight Media's traditional content and channel
resources, creating a media and entertainment
conglomerate comparable to News Group, Viacom or
Disney, Wang said.
"China has already had
many world-class companies, such as the Bank of
China and China Mobile," Wang said. "We believe
some Chinese media and entertainment giants will
befit the country's increasing importance in the
world economy in the near future." He said the new
company will operate on a scale equal to its
foreign counterparts in the next decade.
Established in 1998, Enlight Media is
China's largest independent television program
producer. It produces four hours of TV programming
daily and also operates in the fields of music,
film and soap-opera production.
In recent
years, Enlight Media has sought an independent
initial public offering, but has now given up the
idea after the deal with Hurray. The company's
annual revenue reached about 200 million yuan
(US$27 million) in 2005, according to Wang.
Hurray! is a leading online distributor of
music and music-related products such as
ringtones, ringbacktones and truetones to mobile
users in China through the full range of wireless
value-added services platforms over mobile
networks and through the Internet. Hurray! is also
a leader in artist development, music production
and offline distribution in China through its
record labels Huayi Brothers Music, Freeland
Music, New Run Entertainment and Secular Bird. In
addition, the company provides a wide range of
other wireless value-added services to mobile
users in China, including
Enlight is one
of the largest private entertainment program
producers and publishers in China, producing four
hours of daily entertainment news, music, fashion
and reality shows. The programs are broadcast
through more than 600 television channels in
China, including one national digital
pay-television channel. Enlight is also a leading
event and concert organizer in China, organizing
five annual entertainment award ceremonies
covering the fields of music, television drama,
fashion and modeling. As one of the largest movie
and television drama companies in China, Enlight
invested in and distributed five full length
motion pictures and over 200 hours of television
drama in 2007. It also maintains an entertainment
video library with over 50,000 hours of content
and a video website.
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