Media Prima may end its lease deal with PNB and vacate Bangsar property as a cost-cutting measure

As a cost-cutting measure, Media Prima Bhd may end its lease agreement with Permodalan Nasional Bhd (PNB) for a property in Bangsar. 

The said property is known as Balai Berita and has been occupied by the media group’s 98.2%-owned subsidiary New Straits Times Press (M) Bhd (NSTP).

According to a source that spoke to the The Edge Markets, NSTP will be relocating to its printing plant in Bukit Jelutong, Shah Alam at the end of the year or by middle of next year. 

“The ongoing renovation works on the second floor of the building (Balai Berita), which was originally meant for the new Utusan Group and The Malaysian Reserve, have also been ordered to stop following this new development,” the source added.

The Edge Markets also reported that NSTP interim chief executive officer Mustapha Kamil Mohd Janor, when contacted, confirmed the relocation decision but was not sure if the tenancy agreement will be terminated prematurely.

Both Balai Berita and the Shah Alam printing plant are owned by PNB’s property development arm PNB Development Sdn Bhd, which bought the two properties along with a vacant land in Shah Alam for RM280 million from Media Prima in November 2018.

According to another source quoted by The Edge, the Bangsar property’s annual maintenance fees have amounted to not more than RM10 million in past years, which means this move would save NSTP around RM18.64 million per year.

The Edge also added that it is unclear whether Media Prima’s plan to exit from the Bangsar deal is a mutual agreement between the media group and PNB but noted that the initial expiry date of the tenancy agreement is November 2021.

Click here for article source.

Related news