Metro auctions off ad management

• Source: Global Times
• [09:30 July 26 2010]
• Comments

Passengers pass backlit advertising boards at a metro station in Shanghai as they swipe their way through the turnstiles. Photo: CFP

By Zhou Mi

A subsidiary of the operator of Shanghai's metro system, Shanghai Shentong Metro Assets Management Company, has sold the management rights to part of its advertising space on Line 1 through an auction at the Shanghai United Assets and Equity Exchange.

Shanghai Huiyuan Advertisement won the bid with an offer of 2.33 million yuan ($343,589), 82 percent higher than the opening price of 1.28 million yuan ($188,252) on Saturday, in what was the first advertising management rights deal to be completed through the Shanghai United Assets and Equity Exchange.

"There were three bidders in the auction, and the process was completed in two months," Du Hongliang, director-general of Shanghai Yingming Investment Company, which acted as the agent for the deal, told the Global Times Sunday.

The advertising space consists of 23 backlit boards and 17 billboards in the Line 1 sections of Xujiahui station. The management rights are for a one-year period, from August 1, 2010 to July 31, 2011.

Although Shanghai Shentong has outsourced its advertising space management rights in the past, this is the first time it has put them up for tender.

"This is a first step for Shentong in putting its resources up for auction in a bid to maximize the efficiency with which they are used to generate money," Zhou Yihai, director of the media relations department of Shanghai Shentong Metro Assets Management, told the Oriental Morning Post in an earlier report in May.

No one from either Shanghai Shentong Metro Assets Management Company or Shanghai Huiyuan Advertisement was available to comment on the deal Sunday.