Media Prima plans US$150m media fund
By Azlan Abu Bakar
Published: 2008/03/26
MALAYSIA'S biggest media group, Media Prima Bhd (MPB), plans to set up
a media fund worth up to US$150 million (RM480 million) to invest in
media assets across Southeast Asia.
Group managing director and chief executive officer Abdul Rahman Ahmad
said the MPB Strategic Media Fund Limited Partner****p has an
investment horizon of five to seven years.
The fund is expected to be launched in the second quarter of 2008.
"It will be MPB's vehicle to expand in the region, in line with our
strategy to grow and diversify the group's earnings and enhance
shareholders value," he told re****ters at Invest Malaysia 2008 in
Kuala Lumpur yesterday.
He said the concept of the fund is similar to other private funds, but
in this case specifically targeting the high growth media assets
within the Asean region.
"We will be the anchor investor and at the same time secure other
domestic and international financial and strategic investors," he
said, adding the group will also act as fund manager for the fund
through its own fund management firm.
Macquarie Capital Securities (Malaysia) Sdn Bhd has been appointed as
lead financial adviser to assist in establi****ng and raising funds
from potential investors.
Abdul Rahman said the Media Fund's first investment will be in the
Philippines, where there is a large and growing advertising market.
"We have set up a subsidiary there called Primedia Inc that will soon
enter into a block airtime and consultancy agreement with ABC5 TV
network, one of the television networks in the Philippines," he said.
He said upon inception of the Media Fund, MPB's shareholding and
interest in Primedia will be transferred to the new fund.
Abdul Rahman said under a long block airtime agreement with ABC5,
Primedia will provide content and manage the sale of airtime while the
network will undertake a repositioning and launch exercise as well as
transmission quality upgrade.
"With TV penetration in the Philippines at 72.7 per cent and total
advertising expenditure re****ted at US$2.8 billion (RM8.96 billion) in
2006 with television having more than 75 per cent of that, ABC5
represents a high growth potential," he said.
He said MPB is aware that regional expansion and investment in media
assets overseas will require substantial investment and comes with a
certain amount of risk.
"Our investment through the media fund will enable the group to
minimise this impact to its earnings and balance sheet," Abdul Rahman
said.
Besides the Philippines, MPB is looking at other potential investments
in Indonesia, Cambodia and Vietnam.
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