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Chua's China Channel Fading


Entrepreneur Robert Chua is likely to close his "no sex, no violence, no news" China-focused channel unless a last-minute investor is found.

The Hong Kong-based Chua's decision to fold his 3-year-old satellite operation at the end of January follows a strong possibility that the October sale of 80% of his China Entertainment Television Broadcast Ltd. (CETV) to a mainland Chinese consortium may fall through.

The statement said Chua was "very disappointed" to learn that the transaction contemplated in the agreement "looked unlikely to materialize."

"Unless a 'white knight' is identified shortly to take up the investment, CETV will have to cease operation as early as the end of January 1998," the statement said.

New partners are being sought by one of the members of the consortium, Sun Ji Hui, who is the chairman of the private enterprise Beijing Mega Fortune.

CETV has enough money for another four weeks but plans to lay off some of its 200 staff members this month to cut costs.

Chua is believed to have sunk between $30 million-$35 million on the service in the past 3 1/2 years.

Reasons why the deal fell apart have not been disclosed, but industry sources said the partners failed to come up with the necessary financing.

Previous investors -- the U.S.-based International Family Channel, Malaysian conglomerate MUI Group and the Lippo Group -- pulled out early in 1997.

Like most Asian operations, Chua's CETV has been plagued by low advertising revenue and distribution difficulties in mainland China.

Private reception of foreign satellite signals is banned in China. The exception is Rupert Murdoch's joint-venture Phoenix Channel, which has permission to be carried on cable systems in the southern Chinese province of Guangdong. CETV nevertheless claims access to 33 million households on the mainland.