Malaysia's newsprint manufacturer MNI to wind up

Regional paper manufacturer and supplier, Malaysian Newsprint Industries (MNI) is on its way of winding up. The company, which is partly owned by Media Prima under its The New Straits Times Press subsidary and Hong Leong Industries Bhd (HLI),  is primarily engaged in the manufacture and sale of newsprint.On 2 August, both Media Prima and HLI filed separate statements with Bursa Malaysia in announcing the news, citing that MNI could not continue its business as it had been operating under "very difficult market conditions, especially declining newsprint demand, and has incurred losses for the past three years."MNI is an indirect associate of Media Prima by virtue of The New Straits Times Press (Malaysia) Berhad’s 21.36% direct equity interest. On the other hand, HLI has a 33.65% interest.A+M has reached out to Media Prima, HLI and MNI for further comments.Arising from the creditors’ voluntary winding-up, Media Prima said it will make a full impairment of RM142.4mil which is the group’s carrying amount of investment in MNI as at June 30. Meanwhile, the HLI group said it will make a full impairment provision of RM171.5mil, representing its carried amount of investment as at the same date.Both organisations announced that the provision will result in an adverse impact on its financial quarter ended 30 June 2017. But going forward, the dual will "no longer have to equity account the results of MNI."Incorporated in Malaysia on 4 August 1976, MNI has two other shareholders, namely the Rimbunan Hijau Group, one of Malaysia’s largest multi-industry companies which owns an 11.34% stake and Norske Skog, one of the world’s largest producer of publication paper owning 33.65% stake. Rimbunan Hijau Group is controlled by Sarawak billionaire Tan Sri Tiong Hiew King.MNI which operates a newsprint mill in Pahang's Mentakab, is also the largest supplier for Media Chinese International, which published the Chinese newspapers such as Sin Chew Daily and Nanyang Siang Pau.