KUALA LUMPUR: In the wake of news that Utusan Malaysia will cease publishing on Wednesday, its owner, Utusan Melayu (Malaysia) Bhd, could face possible delisting from Bursa Malaysia.
Bernama reported that the delisting would come about in view of Utusan’s financial distress coupled with a failure to find a white knight.
The possibility of delisting arises after talk that the oldest Malay daily, established in 1939 as Utusan Melayu with its first publication in Jawi, would cease operations this Wednesday after operating for 80 years.
Nearly 100 current and former employees of Utusan Melayu Bhd demonstrated in front of the daily’s main office here today, claiming the company had failed to pay them their wages for one and a half months now.
National Union of Journalists (NUJ) president Taufik Razak, said after a meeting with the Utusan management and executive chairman that he had been informed that the company had no funds to pay either overdue or current wages.
He told FMT that Utusan could face closure within weeks. Malaysiakini reported that Utusan would cease operations on Wednesday.
Bernama reports that as of June 30, Utusan’s accumulated losses stand at RM261.61 million.
In a filing to Bursa Malaysia today, it said that based on the current performance of its publishing, distribution and advertising segment, the board is unsure that the group would turn around by the end of the financial year 2019.
“Due to the above declining results, the group is experiencing a cash flow constraint and has seriously addressed the issue by intensifying its efforts for the disposal of the properties.
“However, the disposal progress is much affected by the slow market sentiment, restriction and requirement by the relevant authorities and thus the company has not been able to resolve the cash flow issues immediately,” it said.
It also said that it is impossible for the group to convince potential investors to revive the business.
“A few potential identified parties have declined to participate due to the group’s huge liabilities,” it said.
Hence, the group would not be able to meet Bursa Malaysia’s requirement to uplift the Practice Note 17 (PN17) status.
The current situation is prejudicial to Bursa Malaysia Securities Bhd’s rights to proceed to suspend the trading of its shares and to de-list the company in the event it fails to submit its regularisation plan to the authorities today.
Hence, Utusan said it is aware that Bursa Securities would take any relevant action including suspending trading of the listed securities on the sixth market day after the date of notification of suspension.
At close today, the share was up one sen to 11 sen with 11,000 shares traded.
The rich history of Utusan began in Queen Street, Singapore, where it was established by Yusof Ishak, who later became the first President of Singapore.
Utusan moved its headquarters to Kuala Lumpur in 1958, a year after Merdeka.
During its heyday in the 1990s, the paper’s circulation peaked at 350,000 copies a day and it was one of the largest selling newspapers in the country. However, sales crashed after 2004, slipping to 250,000, and further down to 144,438 copies in the first half of 2016.
Utusan has been in the red since 2012. In August last year, the company triggered the PN17 criteria after defaulting on its principal and profit payments to Bank Muamalat Malaysia Bhd and Maybank Islamic Bhd totalling RM1.18 million.