KUALA LUMPUR — October 26, 2018: Amid talk of a sell-off, a senior editor with Utusan Malaysia is in favour of Umno disposing its 49 per cent stake in the media group.
Datuk Zaini Hassan, the assistant editor-in-chief (1) of the daily, thinks that this could lessen the pressure exerted on Utusan by the Pakatan Harapan government.
“In Parliament yesterday, there was a call from Pakatan MPs asking the education ministry to stop subscribing Utusan. This will only further strain the newspaper.
“It (sell-off) will be a big turning point for Utusan as it is being pressured by the government simply because its biggest shareholder is not part of the government,” said Zaini.
Talk over this possibility surfaced yesterday after journalist-blogger Datuk Ahirudin Attan wrote about it at his blog, Rocky’s Bru.
Utusan executive chairman Datuk Abdul Aziz Sheikh Fadzir was said to have briefed Umno president Datuk Seri Zahid Hamidi on this.
“Zahid was overhead to have told associates that ‘we have no choice, the party doesn’t have the money to keep Utusan’,” wrote Ahirudin, adding that it could be the start of an end to political ownership in the media.
Umno information chief Tan Sri Annuar Musa was however non-committal when asked to confirm this likelihood.
Utusan, which began in 1939 in Singapore, made headlines two months ago due to its financial woes.
In August, Utusan was classified as a Practice Note 17 (PN17) company, a classification which denotes its financials were inadequate as a listed company and risks being delisted from the stock market if it fails to come up with a regularisation plan within 12 months.
Officially the company has been bleeding over the past few years, with its shareholders’ fund declining to RM89.9 million and with accumulated losses totalling over RM71 million as at the end of last June.
Last month, the company talked about a voluntary separation scheme (VSS) for 800 of its 1,500 employees which was questioned by the National Union of Journalists, which described the offer as dishonest, insincere and suspicious as it was made without consulting the union.
People with inside knowledge of the company said that it in fact has been losing money for a long time, possibly even from the time it went for listing in 1994 and if it showed a profit it was because some of the expenses were off balance sheet.
Due to this financial predicament, Umno had to pump in cash almost yearly but with no turnaround in sight. It became quite acute that a proposal was made in 2006 for the company to be merged with the New Straits Times Group as one entity under Media Prima but strong opposition from within derailed the plan, with lobbyists in the company objecting to the idea using (positive) official information in the company’s annual reports to back up their arguments.
Those also familiar with the historical perspective with the company since a few decades ago pointed out to Utusan’s way of raising cash for immediate-term purposes by selling stakes in companies and other assets given the group by Umno or the government.
Despite its weak financial position, it has one of the best if not the best collective agreements for journalists among all the local press, including those that consistently show good profits. This came about during the tenure of one chief editor who used this to gain and build up popularity and support from his staff.