Chinese media companies BesTV New Media (600637.SH) and Shanghai Oriental Pearl (Group) (600832.SH) both announced suspension of trading in their respective company shares beginning on March 24, with trading to resume following company announcements. The move was reportedly made in preparation for a merger between BesTV parent Shanghai Media Group (SMG) and Oriental Pearl parent Shanghai Media & Entertainment Group (SMEG).
According to media speculation, the suspension of trading in both companies' shares may signify that merger talks between SMG and SMEG have progressed. Sources close to the matter have indicated that the two companies will likely enter into a merger and IPO agreement on March 31. Following the merger, BesTV will reportedly focus on building platforms for smart TV and set-top box (STB) terminal devices, while Shanghai Oriental Pearl will focus more on the digital media space, as well as on businesses relating to entertainment, hotels, and tourism.
Editor's Note: For more background on this topic, please see "Rumor: BesTV to Finance SMEG, SMG Planned IPO" MD 2/19/14 issue.