Proposed Issue of Taiwan Depository Receiptsby QJY

HONG KONG, Aug. 4, 2011 /PRNewswire-Asia/ -- Qin Jia Yuan Media Services Company Limited (stock code: 2366, hereinafter referred to as "QJY" or the "Group" or the "Company") announces that the board of directors has approved the proposed offer and issue of Taiwan depository receipts (the "TDR Issue") by the Company.  The Company proposes to allot and issue up to 280,000,000 new shares of the Company, representing approximately 30% of the issued shares of the Company, pursuant to the TDR Issue.  The new shares will be issued under a specific mandate.  The TDR Issue is subject to the grant of the specific mandate by the shareholders, the Listing Committee of the Hong Kong Stock Exchange granting the listing of, and permission to deal in, the new shares to be issued and the approvals of the relevant authorities for the issue and listing of TDR in Taiwan (the "TDR Listing").  Details in respect of the TDR Issue (including the size and structure of the TDR Issue, the offer price of the TDR and the expected timetable) are still subject to finalization.  The TDR Issue will only be made after approvals in respect of the TDR Issue and the TDR Listing have been obtained from the regulatory authorities in Taiwan.  The application for the TDR Issue and the TDR Listing is expected to be filed with the relevant regulatory authorities in Taiwan in early September of 2011 after the specific mandate is approved.

"The preparation for the application for the TDR Listing on the Taiwan Stock Exchange marks a milestone for QJY's development and is a significant step towards the completion of extending the shareholder base and market presence into the Greater China region.  The cross-media and cultural industry is believed to be the industry following the domestic banking and insurance that will be promoted by the national policy as it is so closely connected to the daily life of a nation and demonstrate the national power of a country.  If the shareholders of a company in the cultural industry are also the consumers of the goods or services provided by the company, they will have better understanding of the businesses of QJY and greater confidence in its investments.  This will enable the cultural asset platform of the Company to be built on a more solid foundation," said Dr. Leung Anita Fung Yee Maria, Chief Executive of QJY.

According to Anita Leung, "the proceeds from the TDR Issue will be applied to expand and develop the core businesses of the Company."  She believes that the shareholders will be benefited from QJY's performance following the business expansion.

Outdoor advertising business is the segment that has seen the fastest growth across the business under the QJY's cross-media platform since its establishment.  The revenue from this segment reached approximately RMB20 million in 2010 and the turnover is expected to be soared by 400% in 2011.  The current QJY's outdoor advertising business mainly comprises the exclusive advertising rights of the 10 outdoor advertising LED boards in major cities in China for broadcasting daily news from Xinhua News Agency.  These large outdoor advertising LED boards are owned by Beijing Xin Hua Zhaoxun Culture and Communication Co., Ltd. (hereinafter referred to as "Xin Hua Zhaoxun"). The Company has entered into a letter of intent with substantial shareholders of Xin Hua Zhaoxun to negotiate for the acquisition of a 51% stake in Xin Hua Zhaoxun over the next three months.  The proposed transaction will enable QJY to not only reap the profit from its own exclusive advertising agency business, but also have a proportionate share of the profit in Xin Hua Zhaoxun according to its shareholding.  The value added by the two businesses beyond the sum of the two, is primarily created by the relationship between the two companies.  After the acquisition of a controlling stake in Xin Hua Zhaoxun, QJY plans to build more large advertising LED boards for broadcasting daily news from Xin Hua News Agency in China with a target roll-out plan of at least 5 LED boards each year.  The expansion plan can help boost the turnover of the outdoor advertising business of the Company.

The core businesses of QJY are the production and distribution of TV drama series. During the year, QJY entered into a 4-year long-term co-operation agreement with China TV Program Production Centre Company Limited, a company owned and controlled by China Central Television (hereinafter referred to as "CCTV") for the investment in the production and distribution of TV drama series.  In July 2011, Beijing BeiAo Group Inc. Ltd. (hereinafter referred to as "BeiAo"), a wholly-owned subsidiary of Beijing State-owned Assets Management Co. Ltd., signed an agreement with the Company for an investment of approximately RMB250 million in TV drama series production projects of QJY over three years.  It is expected that the profit generated from the first-round broadcast of the TV drama series invested jointly with CCTV and/or BeiAo will not be less than 20% of the total amount of money invested in each of them while the global permanent copyright of the co-invested TV drama series will be vested in QJY.

QJY also entered into a cross-strait bilateral cooperation agreement with a related corporation of IMPACT Entertainment (International) Limited for the production and distribution of TV drama series and the production of concerts and art and cultural performance.  The strong tie with CCTV and BeiAo will help QJY expand its market presence beyond the Mainland China to Taiwan.  Furthermore, QJY can ensure the quality of production and enjoy greater savings in the production cost of the TV drama series by engaging Taiwanese artists to participate in the TV production in mainland China.

Besides, QJY entered into letters of intent with CCB International Group Holdings Limited and Star Group International Investment Limited, the holders of two convertibles notes in the aggregate principal amount of HK$150 million signed during the financial tsunami in 2009, whereby the holders of the convertible notes agree to further negotiate with the Company to restructure the convertible notes.

About Qin Jia Yuan Media Services Company Limited (Stock code: 2366)

Founded in 1995 and listed on the Hong Kong Stock Exchange in 2004, Qin Jia Yuan is one of the leading enterprises engaged in a diversified, foreign-owned media business in China with leading capabilities in cross-media advertising sales, television content production and marketing services.

Media Contacts:

Trimaran Corporate Communications

Investor Contacts:

Strategic Financial Relations Limited