MTS is considering acquiring the Mars Media Entertainment production center

As part of the development of its own film production and strengthening of the Kion online cinema, MTS is considering acquiring the Mars Media Entertainment production center. Analysts estimate the transaction amount at 1 billion rubles. Market participants note that Kinopoisk, Okko, Start and Premier are already cooperating with production companies. If the deal with Mars Media Entertainment is implemented, MTS will be able to receive income from projects in film distribution, and then place them on the Kion platform, experts believe.

Sources of Kommersant in the media market said that MTS is considering purchasing the production center Mars Media Entertainment (MME) to develop the production line within the Kion cinema. The film producer, together with an online cinema, is already developing two projects: the series “She’s So Cool” and the feature film “Malvina”.

According to one of Kommersant’s interlocutors, the deal should be completed before the beginning of spring. However, he claims, “the negotiations are complicated by the fact that the company’s founder, Ruben Dishdishyan, is historically close to Gazprom Media Holding, in particular, he is the founder of the Central Partnership film company.” Now MME is working closely with the distributor “Atmosphere of Cinema” – this is a joint project of Mr. Dishdishyan and the ex-general director of the Russian division of Universal Pictures International Vadim Ivanov, created last year.

The cost of the transaction could be about 1 billion rubles, says AFI Capital CEO Alexey Gorislavets, noting that MME is a “major player.” MTS and Kion declined to comment; MME did not respond to Kommersant’s request.

Among the most popular MME projects are the films “T-34”, “Brest Fortress”, “Taras Bulba”, “Two Days” and the TV series “Liquidation”, “Doctor Zhivago”, “The Brothers Karamazov”, “The Great”, “Golden Horde” ” Initially, the company produced 90% of its content for television channels, but in 2020 it decided to change its strategy and focus on projects for online cinemas. Since then, the filmmaker’s projects have been released on the platforms Okko (“Open Marriage”), more.tv (“Chiki”; this year the online cinema became part of Wink), Start (“Black Spring”), “Kinopoisk” (“Hydrogen “). Now MME continues to promote debut films. The total box office of the company’s films in Russia amounted to 4.1 billion rubles, foreign revenue – $5 million.

Today, many participants in the online cinema market already have their own production facilities, notes a Kommersant source close to the management of one of the media services. Thus, Yandex created Plus Studio back in 2018. Okko signed a contract this summer for the exclusive production of series with Originals Production. Start has been collaborating with Yellow, Black and White since 2017. 1-2-3 Production works with Premier; both companies are part of the Gazprom-Media Holding structure.

MME “knows how to create big and ambitious blockbusters,” believes Kino-teatr.ru editor-in-chief Zhan Prosyanov. “Any deal with such a mastodon is a tectonic shift,” he says. In his opinion, in this case, MTS “sees prospects in first collecting large sums at the box office with the help of the film producer, and then attracting viewers for the second round – to Kion.” MTS can conclude a deal with MME in the first look deal format (giving the right to the first selection of projects), Kommersant’s interlocutor in the media market admits. “Many participants do this, and the format of exclusive production for only one platform will be completely unprofitable for MME,” he notes.

Yulia Yurasova