A Beijing-based media group backed by U2 manager Paul McGuinness and developer Seán Mulryan has spent £9.4 million (€13.74 million) on the acquisition of a company in China that provides electronic top-up credit for mobile phones.
Already the owner of the China Business Post weekly newspaper and other media assets in the Chinese market, Sun 3C Media is domiciled in Dublin and listed on the Alternative Investment Market in London.
Sun 3C's shares rose 3.39 per cent to 15.25p yesterday on foot of its deal to buy top-up company Cec-Unet, which has terminals in 18,000 retail outlets in Henan province and a client base of more than five million users.
In addition, the company said it had raised £2.66 million in a share placing priced at 11.8p per share. Investors include Jupiter Asset Management, Savoy Asset Management and Brewin Dolphin Securities.
Sun 3C director John McKeon said the company would use Unet to provide a platform for Sun 3C to introduce electronic top-up services in other regions in China, the world's largest mobile market with 440 million users.
Subscribers pay in advance for phone services, but mobile firms mostly rely on top-up cards to distribute credit.
Sun 3C hopes to use the influence of its executive chairman, Chen Zhao Bin, a former vice-president and chairman in Hong Kong of the dominant mobile group, China Mobile, to secure business for Unet outside Henan province. Many of the company's mobile content products and games are associated with television personality Yang Lan, described as a Chinese equivalent to US celebrity Oprah Winfrey.
In addition to Mr McGuinness and Mr Mulryan, Sun 3C investors include former AIB Capital Markets executive Gerald O'Mahony and former PricewaterhouseCoopers partner Tom Jones.
The purchased company, whose full name is China Electronic Appliances Corporation and Unet, has given Sun 3C a post-tax profit guarantee of 15 million renminbi (€1.44 million) for 2007 and RMB20 million for 2008.
"This acquisition lays the foundation for our aim to be one of China's leading mobile media companies by giving us a reliable source of cash flow, a rapidly expanding distribution channel, and a network of point of sale marketing and promotional venues," said Mr Chen.
