Bakrie-controlled Visi Media to invest $150 mln in Indonesian pay TV
JAKARTA Oct 30 (Reuters) - Indonesia's PT Visi Media Asia Tbk, controlled by the influential Bakrie Group conglomerate, plans to invest $150 million to start a pay TV business next year, the company CEO said on Tuesday.
"Pay TV penetration in Indonesia is still limited and we see this as profitable business. We will focus on sports channels," said CEO Erick Thohir, adding that 50 percent of the funding will be raised from loans.
Visi Media has a market capitalisation of $886 million and controls two free-to-air TV stations and a news website.
Indonesia's economy expanded 6.5 percent in 2011 while its GDP per capita income surpassed $3,000, which analysts believe will spark huge domestic demand as its middle class grows.
Media companies stand to benefit from higher disposable incomes as more people buy TV and subscriber-based media such as pay TV. At present, TV penetration is 60 percent while pay TV penetration stands at 3 percent, according to government figures.
In July, Indonesia's largest pay TV provider, PT MNC Skyvision, raised 2.14 trillion rupiah ($227 million) in an initial public offering that was Indonesia's biggest listing this year and largest media IPO in Asia since 2008.
Visi Media shares closed down 1.82 percent at 540 rupiah on Tuesday while the broader Jakarta Composite Index's was up 0.77 percent.
(Reporting by Fathiya Dahrul, Editing by Matt Driskill)
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