People ride a double bicycle past a logo of The Alibaba Group at the company’s headquarters on the outskirts of Hangzhou, Zhejiang province November 10, 2014.
SHANGHAI Alibaba Group Holding Ltd has agreed on a HK$2.06 billion ($265.8 million) deal to acquire the South China Morning Post and other media assets of SCMP Group Ltd, the newspaper group said in a statement on Monday.
Alibaba and SCMP Group Ltd said on Friday that the Hangzhou-based company would buy the 112-year-old English language newspaper and other media properties, but did not put a value on the deal.
The all-cash purchase, which follows a string of media deals by Alibaba, is likely to raise concerns in Hong Kong where the South China Morning Post occupies an important position and is seen as a barometer for press freedom under Chinese rule.
In a filing to the Hong Kong stock exchange, SCMP Group cited an “uncertain” future for traditional publishing as a key reason behind the sale, adding Alibaba would likely be able to “unlock greater value” from the business.
SCMP Group had a turnover of around HK$1.2 billion in 2014, up slightly from 2013, it said. Net profit for the year was HK$122.6 million.
The group said it expected to record a gain of around HK$1.4 billion from the asset sale. It plans to use the proceeds for the payment of a special cash dividend.
Alibaba has acquired or invested in a growing portfolio of media and content companies in recent years. In June, the company agreed to pay $194 million for an undisclosed stake in domestic financial media firm China Business News.
($1 = 7.7501 Hong Kong dollars)
(Reporting by Adam Jourdan; Editing by Ryan Woo)
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