No political motives behind SCTV takeover: Government
JAKARTA (JP): The Ministry for the Empowerment of State Enterprises dismissed on Monday allegations that the government's plan to acquire a majority stake in the privately-run SCTV television channel is driven by political motives.
"No, it is not politically motivated. The (planned) takeover is based purely on a business deal," said Sofyan Djalil, an assistant at the ministry.
Sofyan was commenting to The Jakarta Post on allegations that the government had pressured state-owned Bank Bumi Daya (BBD) to take over the station in a bid to legalize its way of controlling SCTV news and editorial policies.
He said the government had not yet made a final decision on the acquisition, which many mass media analysts have seen as an attempt by the government to muzzle a critical media.
He added that the acquisition, which would allow the government to take over the company's management, was one of the options being mulled over by the government following SCTV's failure to settle its Rp 250 billion debt to BBD, which matured early this year.
Other options include liquidating the TV network or restructuring the debt.
"Talks are underway; we do not know the best option yet," he said.
The government, through BBD, reportedly plans to take over 52.5 percent of SCTV's shares, currently held by two businessmen, Henry Pribadi and Sudwikatmono, a cousin of former president Soeharto.
The remaining shares are held by another businessman close to the Soeharto family, Peter Gontha.
According to Djalil, the television channel defaulted on its debt of Rp 250 billion (US$33.3 million) to BBD.
However, the SCTV news department said in a statement that the planned acquisition was questionable and could not be detached from its news programming policy, which was considered critical of the Habibie administration.
Sources at the station linked the planned acquisition to external pressure to replace news programming director Riza Primadi with someone the government could control.
The government, according to the statement, considered the station's reporting of the violent clashes on Nov. 12 and 13 between the military and students protesting the Special Session of the People's Consultative Assembly as quite negative toward the government.
"The government seems to be unhappy with the reporting, and we in the news department suspect that the government is behind the acquisition move," the statement added.
"We cannot escape the notion that the government intends to use SCTV's failure to settle its debt as an opportunity to take over the station and control its news programming policy, even though the debt has been restructured," it added.
The Liputan 6 news program has won praise from the public for its bold and extensive coverage of the bloody clashes between the military and student protesters on Nov. 12 and 13 which took dozens of lives, including the lives of many students.
The statement said that SCTV and BBD agreed on April 30 to a debt restructuring deal, whereby the debt maturity was rescheduled by two years to 10 years and three months, and interest and principal payments would begin in the fourth quarter of 1999.
BBD also agreed on Nov.9 to convert the station's offshore debt into rupiah, it said.
The bank did not give any indication of the takeover in its latest correspondence with the station on Nov. 9, the statement said.
However, Sofyan denies any knowledge of such a restructuring deal.
"If they have reached a deal to restructure the debt, why is there a problem?" he said.
Sofyan insisted that a demand for a change in the company's executive board was normal in cases of acquisition.
"It's the normal practice for creditor banks to demand debtors to restructure their management as part of financial management restructuring," Sofyan said.
The SCTV news department staff said that they could accept the takeover as long as there is no government interference with its policy regarding news reporting.
"In principle, SCTV's employees have no reservations about the change in the shareholders' composition as long as the Liputan 6 news program is allowed (by the new shareholders) to maintain its independence," the statement said. (aly/jsk/rms)