Phoenix Media Investment chairman Liu Changle has agreed to sell nearly all of his stake in the partially state-owned TV network operator for a 21.79 percent discount from Friday’s price.
Liu will sell a total of 1.89 billion shares – or 37.93 percent interest – in loss-making Phoenix Media Investment to property and passenger transport conglomerate Shun Tak and state-backed publisher Bauhinia Culture (Hong Kong) for HK$1.15 billion.
Liu holds 1.9 billion shares – a 38.08 percent stake – in Phoenix Media Investment.
Shun Tak has agreed to buy 845.44 million shares, or 16.93 percent of the issued share capital, and Bauhinia Culture has agreed to purchase 1.04 billion shares, or 21 percent of the issued share capital, both at HK$0.61 per share.
Pansy Ho Chiu-king, daughter of late casino magnate Stanley Ho Hung-sun, is Shun Tak’s executive chairwoman.
Shun Tak said it will become a passive investor in Phoenix Media Investment and will not directly participate in its daily management and operations.
Bauhinia Culture, chaired by former Hainan province executive vice governor Mao Chaofeng, runs pro-China Bauhinia Magazine and Hong Kong’s largest publishing conglomerate Sino United Publishing. Beijing’s plan to set up a state-owned enterprise in Hong Kong’s cultural industry was first reported by media in local Hong Kong in January. That SOE later turned out to be Bauhinia Culture (Hong Kong), which was incorporated in March 2019, according to the Companies Registry.
Liu stepped down from the post of chief executive on February 26, and Xu Wei, Shanghai’s former city spokesman, was appointed chief executive on the same day.
Xu has a journalism background, having worked at the Shanghai branch of the Financial Times and having served as the director of the news department of Shanghai Eastern Radio, as well as general manager and editor-in-chief of Shanghai Oriental Satellite TV Media.
Phoenix said in a stock exchange filing that it is considering splitting the roles of its chief executive and chairman by appointing new personnel to take up the position of chief executive. The reshuffle is reportedly connected to a scandal hounding its online lending business.
Phoenix Finance failed to make good on principal and interest payments to investors in September last year, which affected more than 70,000 lenders.
It had a debt balance of almost 10 billion yuan (HK$12 billion) as of October 2020, according to mainland media reports.
Liu founded Phoenix Satellite Television Co in 1996. He has been chairman of Phoenix Media Investment since February 2000.
Liu is a standing member of the National Committee of the Chinese People’s Political Consultative Conference, the mainland’s top political advisory body. Liu’s father was an official at the human resource management department of the Central Committee of the Chinese Communist Party in 1950s.
Phoenix Media Investment booked a net loss of HK$1.04 billion in 2020, compared to a net profit of HK$122.66 million a year before.