SCMP.com buys into StockHouse

SCMP.com, the internet arm of South China Morning Post, has bought a 5.45% stake in New York-based StockHouse Media Corporation. SCMP.com is investing through a mixture of cash and shares for its 5.45% stake in the $140 million company, valuing its stake at $7.63 million.

Integral to the deal are agreements that SCMP.com will provide content for StockHouse Media CorporationÆs newly launched Hong Kong website, Stockhouse.com.hk. In turn, Stockhouse.com.hk has committed to buy advertising space from SCMP.

ôLast year, StockHouse formed a similar arrangement with publishing giant Hollinger International in Canada,ö says Jeff Berwick, Founder and President of StockHouse Media.

ôThat relationship significantly accelerated our growth in the Canadian market and also exposed Hollinger to StockHouseÆs extremely active online audience. We expect the SCMP.com partnership will accomplish similar objectives for both firms here in Hong Kong and beyond.ö

Commenting on the SCMP.com investment, Kuok Koon Seng, CEO of SCMP.com said, ôContent is critical and it confers a sustainable competitive advantage. We are confident that StockHouse can replicate in Asia its record of success in North America and Australia.ö

It is unclear where the revenues to support the venture will come from, although company sources claim that online advertising and e-commerce will sustain Stockhouse.com.hk.