Hong Kong’s struggling pay TV provider, iCable, enters China through deal with Guangdong CableTV Network in bid to revive fortunes
- The new agreement would allow the loss-making pay TV operator to reach 14 million mainland residents in southern China
- ‘We hope this agreement will bring our business back on track,’ says Irene Leung Shuk-yee, iCable’s chief operating officer
Hong Kong’s biggest pay TV operator, which has racked up losses of more than HK$2 billion (US$254.9 million) in the past decade, is set to broadcast its shows to viewers in China for the first time, thanks to a new partnership with Guangdong CableTV Network.
The embattled i-Cable Communications said it has signed an agreement with Guangdong CableTV Network that will allow it to air programmes to 14 million mainland Chinese pay TV users.
“We hope this agreement will bring our business back on track,” said Irene Leung Shuk-yee, the company’s chief operating officer.
“We will provide content such as finance news, and news related to the Greater Bay Area development to mainland users.” She was referring to Beijing’s plan to create an economic hub by linking Hong Kong, Macau and nine other cities in Guangdong province.
The two companies will also collaborate in the areas of business and technology development, Leung said.
Guangdong CableTV Network is one of the biggest cable television stations in China, broadcasting to more than 14 million households. It also provides broadband services to nearly 3.5 million households.
The pay TV service of i-Cable is run by a subsidiary, Hong Kong Cable Television, which produces more than 10,000 hours of programming each year. i-Cable also runs an internet and multimedia operation.
The company, which began broadcasting in 1993, has been suffering heavy losses for years. The previous owner, The Wharf Holdings, refused to inject funds and put it up for sale in mid 2016.
The company lost money for 10 straight years, amounting to about HK$2 billion, its chief financial officer Joe Kwok said in March last year. The business has not managed to turn itself around even though a new consortium, Forever Top, came to the rescue with a cash injection of HK$1 billion in April 2017.
For the six months ended June 30, the company posted a loss of HK$253.3 million, versus HK$362.4 million in the second half of 2017. But revenues fell by more than half to HK$587.5 million from the previous six-month period.
iCable shares rose 2.68 per cent to HK$0.12 on Wednesday. On January 9, the company’s proposed HK$691.7 million rights issue exercise was rejected by minority shareholders.
Forever Top (Asia), the controlling shareholder of i-Cable with a 43.2 per cent stake, will continue to provide financial support to the company, according to Leung.
Forever Top is co-owned by a group of investors led by New World Development chairman Henry Cheng Kar-shun, Chow Tai Fook Enterprises, which is owned by the Cheng family and David Chiu Tat-cheong, who is also the chairman of i-Cable. Other investors include Zhao Huan, executive director of mainland technology giant Legend Holdings and Li Sze-lim, chairman of Guangzhou R&F Properties.
