Indonesia halts trading of three MNC firms after court ruling

PHOTO: Indonesia halts trading of three MNC firms after court ruling

JAKARTA - Indonesia's stock exchange suspended trading on Friday in Media Nusantara Citra Tbk PT and two affiliates after a Supreme Court ruling the previous day against the company in a long-running dispute over ownership of a television firm.

The other two suspended companies are Global Mediacom Tbk PT and MNC Investama Tbk PT and are controlled by media mogul Hary Tanoesoedibjo.

The dispute centres on ownership of the free-to-air station MNC TV, formerly called TPI when it was under the control of Siti Hardiyanti Rukmana, popularly known as "Tutut" and the eldest daughter of former autocratic President Suharto.

Rukmana had handed over a majority stake in the TV station to another firm, Berkah Karya Bersama, in exchange for outstanding debts. Berkah then sold ownership to Tanoesoedibjo's group in 2006 following a shareholder's meeting the previous year and which Rukmana had argued was illegal.

The Supreme Court ruled in her favour.

In statement, MNC said while the Supreme Court had backed Rukmana's appeal, it had not formally announced the details of its ruling.

"We are confident that this case will not have any impact on our ownership of MNC TV and operations will continue to run normally," Tanoesoedibjo said in a statement.

"This case has nothing to do with MNC. The case is directly between Berkah, the company we acquired TPI from, and Tutut. We acquired the TV station from Berkah Karya Bersama in 2006. MNC has and had no ownership or economic interests in Berkah."

At Thursday's close, Media Nusantara's shares fell 10.3 per cent to 2,600 rupiah (S$0.286). Shares of Global Mediacom dropped 9.4 per cent to 1,970 rupiah while MNC Investama slid 4.1 per cent to 350 rupiah.

"Given the uncertainty on this case, we see near-term share price volatility on the stock, which we believe presents an enhanced buying opportunity. We view MNC as one of the main beneficiaries of Indonesia's robust ad spend growth, backed by the rising middle class and the country's solid macroeconomics,"Citi Research said in a note on Friday, adding it expected more court battles over the issue.