Emtek Group’s Surya Citra Media (SCM), through its unit Indonesia Entertainmen Group (IEG), has acquired 80 per cent stake in production house Sinemart Indonesia, the company said on Wednesday. The purchase had been completed on January 23, 2017.
Sinemart Indonesia is a local soap opera producer that has helped competitor Media Nusantara Citra (MNC Group) retain the highest audience share on its RCTI channel. Although not owned by MNC, the production house had been exclusively creating popular shows for RCTI such as Tukang Bubur Naik Haji and Anugerah Cinta for 10 long years.
“Owning 80 per cent shares of Sinemart can upgrade the TV shows content quality in Surya Citra Televisi (SCTV), a private TV station under SCM, to synergize with and improve the SCM performances,” said corporate secretary Gilang Iskandar.
Sinemart has agreed to produce five soap operas for SCTV during the first quarter of 2017 and terminate its cooperation with MNC.
It is not clear on the value of the sale that SCM and Sinemart had agreed on. But according to a report by Mirae Asset Securities (Daewoo), it could reach as much as Rp 1 trillion ($75 million). The number was mentioned by an unnamed MNC executive in a commentary on Sinemart’s deal, who called it a “desperate move by Emtek Group”.
“Despite the quite high acquisition price of Sinemart, we believe it will be a valuable long-term investment for SCTV as it will increase its audience share and eventually its rate card,” said Mirae’s analyst in its report.
Prior to Sinemart takeover, SCTV had already owned three production houses: Screenplay Production, Amanah Surga Production and Screenplay Film. It also often sources its prime time local dramas from other production houses, such as Mega Kreasi Film.
Despite already having four production houses under its wings, SCTV’s performance in 2016 was less than satisfying, with only 11.2 per cent of audience share, the lowest for the channel for prime time category. Meanwhile, MNC’s RCTI reported a 29.4 per cent share year to date (ytd).