KUALA LUMPUR, July 14 — Media Prima Berhad may prematurely end the long-term lease for the Bangsar headquarters of its New Straits Times Press Bhd (NSTP) unit in favour of a Shah Alam location, according to sources.
They told The Edge Weekly that the media group was considering the move as part of its austerity campaign.
The NSTP headquarters — known as Balai Berita — is currently from Permodalan Nasional Berhad (PNB), a substantial shareholder of Media Prima with a 6.1 per cent equity interest held via Amanah Saham Nasional.
The sources said the Shah Alam location being considered was also a PNB property.
“The move is part of Media Prima’s cost-cutting measures, which will see NSTP relocate to its printing plant in Bukit Jelutong, Shah Alam at the end of the year or by middle of next year,” one source was quoted as saying.
“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.”
NSTP interim chief executive officer Mustapha Kamil Mohd Janor told The Edge that he was unsure if the lease agreement was being ended early as it was due to expire at the end of 2021.
However, he confirmed that the group was undergoing a “rationalisation exercise”.
Both Balai Berita and the Shah Alam printing plant belong to PNB’s property development arm, PNB Development Sdn Bhd, which bought both along with a vacant land in Shah Alam for RM280 million from Media Prima in November 2018.
The money was used to repay its bank borrowings but the group continued to face financial difficulties.
Media Prima previously announced it was proceeding with the next phase of its business transformation due to disruptive changes in the media sector and challenging macroeconomic conditions, which were exacerbated by unknown variables surrounding the Covid-19 pandemic.
These factors have compelled the group to expedite the next phase of its transformation exercise, which includes revising revenue models and corresponding cost management.
It issued retrenchment notices to approximately 300 employees, whose last day of employment will be on July 31.
The group and representatives of its five union groups concluded discussions on the execution of the next phase of the Media Prima business transformation plan that was announced on June 4.
The Edge Weekly also reported Media Prima still has at least six properties: the Sri Pena Resort in Port Dickson; an office in Georgetown, Penang; an apartment unit in London, UK; a printing plant each in Prai (Penang), Ajil (Terengganu) and Senai (Johor); and a TV studio facility in Glenmarie, Shah Alam.
It is understood that the printing plants in Ajil and Senai have been put up for sale while the Prai printing plant is currently occupied by Sinar Karangkraf Sdn Bhd, home of Malay-daily Sinar Harian.