Shanghai Wenguang Integrated Show Weekend Announced: 100 Billion Media to Debut

The veil is about to be unveiled, and several brokerage researchers at the company's Big Smart News Agency confirmed that BesTV and Oriental Pearl will hold an investor exchange meeting in Shanghai on Saturday (22th) regarding the restructuring plan and the future development plans of new listed companies. This will be the first case after the "media integration" was put forward in August this year. A shares will not only have the first 100 billion yuan worth of new radio and television media groups, but will also drive other media state-owned enterprises to inject assets, introduce strategic investors and equity incentives. Other breakthroughs have been made.

Three steps of SMG's integration plan, new listing platform will receive high valuation

At present, major issues concerning the merger and acquisition of the conversion of BesTV and Oriental Pearl, two listed companies of Wenguang, have been basically finalized. According to informed sources, the integration plan is mainly divided into three parts: BesTV will create a new listing platform by absorbing and consolidating the Oriental Pearl; inject the core high-quality assets and business resources of the four market segments, increase the securitization rate of the group's assets, and promote the overall listing process. Directly increased issuance of 80-100 billion yuan of funds, the introduction of strategic investors, investment in the layout of OTT, the new media industry chain.

In an earlier interview with the media, SMG Chairman Li Ruigang appeared confident in the future after the integration. He said: "After the completion of the integration and reorganization, we have greater room for integration with the capital market, and we can mobilize capital to realize The possibility of leap-forward development has exceeded the past, and some businesses will have breakthrough growth in the coming years."

A media industry analyst said in an interview with Great Wisdom News Agency that after the integration plan was completed, it completely solved the previous industry competition risks, and the new listing platform will become SMG's only capital operation platform, with broad development prospects, and will transform into a whole The vertical integration of the industrial chain integrated media platform, the secondary market valuations increase, the estimated price-earnings ratio can reach 50 times.

It is worth noting that before the suspension trading, BesTV's price-earnings ratio was 49 times, and the Oriental Pearl was only 28 times. And if measured at a 50x P/E ratio, the market value of the new listing platform will exceed 100 billion yuan in 2014, making it the only media company with a market value of 100 billion yuan in the A-share market.

SMG four assets injected into the new company, improve the layout of the upstream and downstream industry chain

The injection of quality assets is a subject of great concern in this SMG reform. According to the Great Wisdom News Agency, BesTV has absorbed the merger of Oriental Bright Pearls through the issuance of shares and the purchase of assets through cash payment, and has injected SMG's four major assets: Shang Shi Ying Yee, Dong Fang CJ, Wen Guang Interactive and Wu Yanan into the listed company.

According to the roadshow data obtained by the Great Wisdom News Agency, the above four assets have different levels of performance, and after injecting new listing platforms, they may stimulate synergy and gain more room for development.

Shangshi Films achieved a certain degree of development with high ratings such as “Dwelling”, “Cliff” and “Floating”. In 2013, the net profit was less than RMB 100 million, and the year of Huace Film & Television (300133.SZ), the leading company of the same industry After deduction, the net profit was 216 million, which was more than twice that of Shangshi Film. However, after relying on the powerful SMG, Sang Shiying Films, after injecting into the listed company, is expected to better play its business synergy effect and to take up more resource advantages in the market competition.

Eastern CJ is China's first home shopping company. Previously, it was hoped to be listed separately, with a high level of performance. It is worth noting that part of the funds raised by the new company will also be used for the construction of a new media shopping platform. Several brokerage firms have expressed their optimism for the further development of Eastern CJ in the new media field.

Wenguang Interactive has significant advantages in licensing resources and is one of the four national integrated cable digital payment channel operators, covering 30 provinces, cities and autonomous regions. Five-Side Communications will be responsible for the operation of all copyrights of SMG after the assets are injected.

Analysts familiar with the company believe that only the East CJ can directly increase the performance of the new company in the above four assets, but after injection, it fully covers the upstream and downstream content production, copyright distribution, platform-based pay-TV, interactive on-demand services and services. The end of the e-commerce, improve the new company's industrial chain layout, improve the income structure, and bring a sustainable performance growth point for the new listing platform.

Media state-owned enterprises will adopt a reform model, and asset injection and equity incentives will break through

While creating a new company with a market value of one hundred billion yuan, SMG integration also provides more imagination for the reform of media state-owned enterprises.

An analyst familiar with the industry said that currently the actual controller of radio and television cable operators listed on China’s A-shares is basically local radio and television group, with high operating income and good assets. This time, SMG’s integration will break the basics of subordinate listed companies. Only for the current status of wired assets, other places in the Radio and TV Group are expected to follow up quickly and the dividends brought about by the reform will continue.

It is worth noting that Hunan Broadcasting and Television, which is comparable to SMG's advantage, has been optimistic that the reforms are expected to duplicate the SMG model. E-Media (000917.SZ) is expected to benefit fully. According to the 2013 annual report of E-Media, Hunan Broadcasting and Television has promised to E-Media that Hunan Radio and Television will actively explore and inject operating assets such as subordinate media into the company to completely solve the competition with the policy and conditions.

The above-mentioned media analysts believe that although the happy purchase of Hunan Radio and TV Group is impacting the IPO and Happy Sunshine is also seeking A-share listing, there are still high-quality assets injected into the businesses currently carried out by E-Media including television, cable TV and advertising. prospect.

In addition, according to the Great Wisdom News Service, it was learned that the new listed company of SMG had already included the launch of the management’s shareholding plan. The above analysts said that the move is expected to promote ice-breaking of equity incentives for state-owned media companies and will lead other companies in the industry to introduce long-term incentive systems that will increase the vigor and efficiency of the company's operations and will be more positive in the upstream and downstream M&A of the industry chain.