Tencent-backed production house PT MD Entertainment Tbk is planning to acquire an 80% stake in IDX-listed PT Net Visi Media Tbk (NETV) for about 1.65 trillion rupiah ($107 million), according to a disclosure to the Indonesia Stock Exchange (IDX).
The transaction will allow MD Entertainment to become the new controlling shareholder of NETV. Before this, PT Sinergi Lintas Media, a company owned by Agus Lasmono, founder of Indika Group, was the majority shareholder with a 59.58% stake. Indika Group also owns a 7.69% stake in NETV through PT Indika Inti Holdiko.
Meanwhile, GoTo’s PT Semangat Bambu Runcing holds 8.72%, PT Teladan Investama 11.84%, and the rest is owned by the public.
As of April 30, 2024, NETV’s liabilities stood at 1.76 trillion rupiah, or 151% of the company’s assets at 1.16 trillion rupiah. Its capital deficiencies stood at 596 billion rupiah. The takeover will help increase the company’s assets to 2.16 trillion rupiah, liabilities to 1.08 trillion rupiah, and capital to 1.07 trillion rupiah.
The acquisition will help MD Entertainment expand its business to television, as it currently focuses more on movie production. The company recorded a net profit of 72.6 billion rupiah in the first half of 2024, up 24.3% compared to the same period last year at 62.1 billion rupiah. Most of the profit came from two blockbuster movies — ‘Ipar Adalah Maut’ and ‘Badaruwhi: Di Desa Penari’. Its revenue grew by 5.9% to 217.4 trillion rupiah from 205.4 trillion rupiah during the period.
MD Entertainment plans to expand its coverage internationally by partnering with big Hollywood studios. In March 2024, MD Entertainment announced its partnership with global movie distribution, LIONSGATE Entertainment Crop, and produced ‘Dancing Village: The Curse Begins’, which was successfully distributed in the US.
The company is also exploring partnerships with big Hollywood production houses as well as pursuing inorganic strategies in other countries. It also plans to distribute the movie content to other channels through TV stations and OTT platforms. It will open new revenue streams for the company, including advertising revenue.
Founded in 2002 by Manooj Punjabi and his father, Dhamoo Punjabi, MD Entertainment is the only production house listed on IDX. The company went public in 2018 after raising 416 billion rupiah in an initial public offering.
PT MD Global Investments is the majority shareholder of the company with a 50.5% stake. Meanwhile, Manooj Dhamoo Punjabi owns 17.83% and Tencent holds 14.62%. The Chinese firm invested 695 billion rupiah in MD Entertainment through its unit, Image Frame Investment, in 2021.
