the upcoming plans of GS Group abroad

26.6.2014
Intelligence Detail | Mergermarket.com
23/06/2014 GS Group m ulls JVs, acquisitions in Indonesia, Pakistan,
Myanm ar – executive
Proprietary Intelligence
Story
Bidder
GS Group
Previous Law yer Osman Legal
Law yer
UHY
International
Other
Telenor ASA
Other
BT Group Plc
GS Group is interested in concluding the deals in 12-18 months,
Dolgopolsky said adding that each deal is estimated at USD 20-30m. The
total planned investments in international projects until 2017 w ill total USD
300m, he noted.
Other
Telekomunikasi
Indonesia Tbk,
PT
Other
Beximco
The company looks to keep the majority share and control the everyday
business of JVs w ith the local partners, Dolgopolsky said, adding that in
some countries GS Group may buy local companies directly.
Other
Surya Citra
Media Pt Tbk
Other
CT Corp, PT
GS Group is considering inviting local and international financial and legal
consultants to close the deals, he said. The company already w orks w ith
UHY in Russia and Pakistan.
Other
Visi Media
Asia Tbk, PT
Other
Royal Group
of Companies
(RGC,
operating
under One TV
brand)
Other
Telkom Vision
Other
SkyNet
Other
Forever Group
Russian privately held electronics maker GS Group mulls setting up JVs
and acquiring pay-TV providers in Indonesia, Pakistan and Myanmar,
Sergey Dolgopolsky, foreign projects director at GS Group said.
Earlier this year, GS Group hired Bangladeshi law firm Osman Legal to
structure the JV w ith the Bangladesh industrial conglomerate Bexim co
to provide satellite TV services in the country. In 2012, GS Group created
a JV w ith The Royal Group in Cambodia to provide digital TV
broadcasting services.
The Pakistani market attracts companies from the UK (British
Telecom ), Finland, Qatar, UAE, and Norw ay (Telenor), Dolgopolsky
added. “They are also planning to take part in local tenders to provide
telecommunications services, but w e do not consider them as our
competitors, rather as partners in JVs,” Dolgopolsky said.
“The Pakistani law s require having a local partner w ho might have a
minority stake in the company. We have already held negotiations w ith
local companies,” he added declining to name the companies.
Though majority of the funding for future acquisitions w ill come from the
company’s ow n fund, it may consider tapping debt funding to partially
bankroll the future takeover, Dolgopolsky said.
Founded in 1991, GS Group produces various television equipment
including peripheral TV equipment for satellite television, digital TV, and
other equipment. The company does not disclose its financials.
In Pakistan, 70% of households that ow n a TV set has cable TV, 2%
have a satellite antenna, w hich comprise 11.6m people, GS Group’s data
reads. Urban penetration of cable and satellite TV totals 85%. There are
over 350 cable netw ork providers in the country; each one caters to a
special locality, as per GS Group’s data.
The largest digital TV providers in Indonesia are Indovision, TelkomVision
and TopTV, according to GS Group’s data. Legal cable TV operators
serve 0.47m subscribers. How ever, according to Indonesia Multimedia
Providers Association, there are more than 2000 illegal cable operators in
the country.
Many foreign companies are interested in pay-TV business in Indonesia,
but they need to get a business license from the government, a Jakartabased banker said. Some local media companies are also expanding into
pay-TV business through acquisitions or establishing of new
subsidiaries, he added. The Indonesian diversified holding CT Corp,
w hich operates a media subsidiary, acquired pay-TV services provider
TelkomVision from the local telecommunication company
Telekom unikasi Indonesia in 2013, w hile other media companies
established their ow n pay-TV subsidiaries, namely Surya Citra Media
launched NET TV in 2011, and Visi Media Asia launched VIVA Sky in
2013.
DS
Sectors
Media
Telecommunications:
Hardw are
SubSectors Cable equipment
Media houses
Mobile/satellite netw ork
equipment
TV broadcast
Voice and data
communication
equipment
Topics
Advisory Invitation
(Bankers, Other)
Joint
Ventures/Partnerships
Market Entry
Intel Type
Bolt on/Opportunistic
Cross Border
Countries
Indonesia
Myanmar
Pakistan
Russia
Intel. Grade Confirmed
Intelligence 1825592
ID
In Myanmar, 48% of population ow n a TV set. Pay-TV is used by only
4% of households due to high piracy from unregistered satellite dishes,
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26.6.2014
Intelligence Detail | Mergermarket.com
according to data from Singaporean research agency Venture
Consulting.
According to Venture Consulting, there are tw o pay-TV operators in the
country: Forever Group and Skynet.
The government of Myanmar is about to issue a broadcast law in the
near time, an industry player said. The local players are expecting the
law w ill allow them to form joint ventures, he said. At this time, foreigners
w illing to form a JV must have a local partner w ho already has pay-TV
permission, another local businessperson said.
by Sergey Kolyada in Moscow and Deviana Chuo in Singapore
Source
Proprietary Intelligence
Value
GBP 176m (total planned investments)
Stake
Value
N/A
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