The media company must come up with a plan within the next 12 months.
PETALING JAYA: Umno-affiliated media company Utusan Melayu (M) Bhd is faced with the possibility to be removed from the stock exchange after it has been classified as a Practice Note 17 (PN17) company that indicates that its financial situation is inadequate.
The star reported that the company said yesterday in a complaint to Bursa Malaysia that it should come with a regularization plan within the next 12 months.
The company, which publishes Utusan Malaysia, has been in default on loans from Bank Mualamat Malaysia Bhd and Maybank Islamic Bhd, the report said.
It was dependent on government support to last for two years, but previous reports have said that this may not go further than this year.
Employees have been told that the company will soon run out of money because it is struggling in the aftermath of Barisan Nasional's recent polls.
The top management had told the staff that major restructurings were being planned as part of a strategy to deal with difficult times.
If it fails to come up with a plan, it risks to be removed from the stock market.
For the first quarter ended March 31, 2018, Utusan suffered a loss of RM5.8 million. In the same period last year it lost RM22.8 million.
Despite a decline in the readership, the Malaysian newspaper has been able to survive for some time through government contracts, obtained through its ties with Umno.
Last year it was reported that the company was contracted to deliver more than 180,000 tablets to teachers across the country. Weeks before the polls of 9 May, Utusan was charged with printing campaign posters for BN.
Earlier this month, however, it was reported that a note was issued to schools, colleges, universities and agencies under the Ministry of Education to immediately terminate the subscription to the Utusan Malaysia newspaper.
Other Umno-affiliated media companies, including New Straits Times Press, are also trying to adapt to the new political landscape that is slowly taking shape under the Pakistani Harapan government.
NSTP, which publishes the once-virulent pro-Umno New Straits Times and two other newspapers, has called on its staff to "editorially" adapt to the new political climate, and said that they would now maintain "neutrality" in reporting.