mm2 Asia will sell film business, including Cathay, for $ 84.8 million – Health Guild News


Asia-based film operator Asia, under the Cathay brand, is in talks with local investment company Kingsmead Properties to sell its film business for $ 84.8 million.

A meeting will soon be held to approve the agreement between shareholders and regulators.

The content creation and distribution business of mm2 Asia was strategically based on its film business, which unfortunately has had the weight of the impacts of Covid-19. The group hopes that this sales proposal will stabilize their financial situation and allow them to focus on developing growth opportunities for basic production content.

The company will use the proceeds from the proposed sale to pay off its outstanding loans, which include convertible bonds that are due on December 31, 2021.

Its projected net income, after deducting transaction costs and revenues, will reach an estimated $ 67.34 million.

The resulting loss from the company is expected to be around $ 84.66 million, a representation of the income deficit over book value, based on the audited consolidated financial statements for the year 2021.

At the end of March 2021, the company’s liabilities exceeded its assets by US $ 119.5 million, asking its auditor to indicate that an existing material uncertainty is hampering the long-term viability of the company.

A brief history of mm2 milestones in Asia

mm2 Asia was founded in Malaysia in 2008 and is currently headquartered in Singapore.

The group made history in December 2014 by being the first, and possibly the only local producer listed on Catalist, the secondary board of the Singapore Stock Exchange.

In 2015, mm2 Asia, through its wholly owned subsidiary Screen Management, completed the acquisition of Cathay Cineplexes and its commercial operations at two Malaysian locations for $ 13.8 million.

Cathay Cineplex / Image Credit: The Cathay

In November 2017, MM2 Asia acquired Cathay Organization’s eight Singapore cinemas in Singapore $ 230 million, in addition to 19 other cinemas operating in Malaysia.

The group made a previous offer in a US $ 184 million deal in June 2017, to acquire 50% of Singapore’s Golden Village film business. The acquisition was subsequently intercepted by Orange Sky Golden Harvest Entertainment (Holdings) of Hong Kong in July 2017.

Last April, mm2 Asia launched a free video streaming service, mPlay Asia, with the goal of leveraging the demand for quality Chinese online content.

However, from January to September of the same year, mm2 Asia fell to a net loss of $ 22 million. In contrast, the company made a net profit of $ 9.18 million in 2019.

Featured Image Credit: Klook

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