No immediate rationalisation expected after SPH-ACP deal

Jim Goh, chief executive at Briq Communications, told Campaign that the acquisition was a good one for SPH Magazines, as ACP Magazines holds strong titles such as CLEO, The Women’s Weekly, Bazaar and Cosmopolitan, which have regional presence.

“It will be interesting to see what is going to unfold in the next six to 12 months. The acquisition will consolidate strong titles overseas and local ones under SPH’s portfolio, and it is not sure if they are going for any rationalisation exercise. However, they will see how they can leverage [their respective strengths] and expand the footprint of some magazines in the region,” he said.

Goh added that some titles under SPH Magazines would have to be examined for viability, which would take 12 to 18 months.

Melvin Lim, CEO of Havas Media Singapore, said, "The industry will welcome the acquisition as it is likely to make their offering stronger and more integrated across its entire portfolio."

SPH Magazines recently announced that it will acquire ACP Magazines with CIMB Bank Bhd, Singapore branch, its financial advisor in relation to the acquisition.

It was reported that Nine Entertainment chief David Gyngell sold off the group's ACP Asia magazine assets to SPH for US$45.5 million (SG$58 million).

ACP Magazines publishes 11 titles across four countries, covering the interests of almost every woman in Asia. The acquisition will see SPH Magazines becoming the trademark owner of The Women's Weekly and CLEO in Singapore, Malaysia and Indonesia, and The Finder in Singapore and Malaysia.

It will also take over ACP Magazines' 50 per cent share in the joint venture with Hearst Magazines International, which publishes Harper's BAZAAR and Cosmopolitan in Singapore and Malaysia.

Cosmopolitan Singapore was relaunched in August after a 29-year absence, as the Media Development Authority (MDA) introduces new content classification initiatives for media. It was banned in Singapore in 1982 because of its forthright content.

Bharad Ramesh, regional executive director, strategic operations & trading, Asia at Starcom Singapore, said the acquisition would be judged by how well SPH repositions itself into a content company for the digital age.

"This move would consolidate the magazine industry in markets like Singapore and Malaysia, taking a greater share of a declining market. It gives SPH tremendous pricing power given the qualitative bias most magazine advertisers have towards the medium. Geographically, this move poses a great opportunity for SPH to venture into Indonesia," he added.

He noted that the move would give SPH greater access to female readers, which has traditionally been the domain of MediaCorp.

Meanwhile, Loh Yew Seng, chief executive of SPH Magazines, said in a press statement that the two publishing houses would be able to build on one another's strengths to bring our products to a higher level, and increase its effectiveness and efficiency as a whole, following the acquisition.

“Besides looking into new areas of growth for the long term sustainability of our business, we will also be giving added value to all our readers and advertisers across multiple media platforms,” he added.

In a separate reply to Campaign's query, Loh noted that this acquisition brings together two leading publishers with very strong titles and track records. "It will increase our resources and expertise to boost the strength and attractiveness of our multi-media platforms. For advertisers, it means increased choices, greater reach and more effective advertising solutions."

Julie Sherborn, chief executive officer of ACP Magazines, would be appointed as publishing consultant during the transitional period, reporting directly to Loh.  Meanwhile, Bridget Hope, publishing director at ACP Magazines currently heads the editorial staff team, will report to Caroline Ngui, group editor-in-chief of SPH Magazines.

Seymour Cohen, commercial director at ACP Magazines heading the marketing and sales team, will report to Maureen Wee, managing director for Lifestyle Division at SPH Magazines.

Sherborn said the acquisition would be a catalyst to its products' growth, and would further enhance its relationship with all stakeholders, including the readers, advertisers and business partners.

In terms of advertising rates, Goh said he expected to see a hike as some cross-packaging would be introduced "as justification".