Catcha - JV with says.com

It has attractive prospects and big plans ahead. For one it is targeting earnings of rm10 million within the first year of a JV with Says.com to create what it considers to be one of the largest digital advertising businesses in Malaysia.

Youth Asia is the owner of Says Sdn Bhd, which in turn holds Says.com, an online advertising platform that serves more than 80 brands such as Nike, Coca-Cola and Maxis. It has a strong presence in Malaysia, India, the Philippines and Singapore.

Coming together as a merged entity will allow them to go for an IPO (for the digital advertising business). Catcha Media will have to complete the integration of the companies first.

The company is already talling to a few strategic overseas partners to invest in the IPO and proceeds from the exercise will be used for regional expansion.

It has four businesses – publishing, online media, e-commerce and online classifieds.

The online classifieds segment comprises iCar Asia Ltd, which houses used car trading websites and was listed on the ASX in Sept 2012. Catcha Media has a 30% stake in iCar Asia.

iCar Asia is currently (July 2012) its most valuable asset valued at rm85 million. It is currently (Oct 2013) No 1 in Malaysia in terms of volume of listing.

It has been toying with the idea of going private if the company’s share price continues to languish.

It was reported that Catcha has a target price of rm0.90 for the company based on a sum of parts valuation, which takes into account its 30% stake in iCar Asia. Bit in the long term, if the share price remains undervalued, it is only logical to consider a privatization at the end of 2013.

It posted an encouraging financial performance for the financial period of January 1 to December 31 last year with an after-tax gain of RM2.5 million.

Market observers regarded the company as severely undervalued with zero value given its advertising and e-commerce business, as well as its fundamental strength.

 It is worth noting that its market (15 Oct 2013) capitalisation is just slightly higher than the value of its 29.18 per cent stake in Australia-listed iCar Asia Ltd. Australia-listed iCar Asia is 30%-owned by Catcha Media and Asean's top online auto classified portal.

However its CEO says in May 2013 Catcha.com would not be taken private for the time being, although major shareholders might do so if its shares remained flat till the end of the year (2013). Several private equity funds had approached him about the possibility of buying out the company.

Two funds, one local and the other a US-based firm regionally headquartered in Singapore, had expressed interest in taking Catcha Media, which debuted on the ACE Market in 2011 at 75 sen a share, off the market.

Management is seeking to sell equity in Catcha Media's subsidiaries, which would establish their valuations.

Grove has an indirect stake of 58.5% in Catcha Media as at May 2013. It is followed by HSC Healthcare Sdn Bhd, Datuk Justin Leong of Genting Bhd and Star Publications Bhd.