The much-touted Iskandar Malaysia Studios, previously partnered with the UK’s famed Pinewood Studios, recently sold to a Singapore firm for mere pennies on the dollar.

You may remember the launch of Iskandar Malaysia Studios, just under a decade ago. IMS was touted as a premier destination for filmed entertainment productions in Southeast Asia, with the studio complex housing state-of-the-art film stages, TV studios, water filming tanks, and extensive production support facilities.

The idea behind the development was for IMS to serve as a preferred location for global film and television productions, but also to help promote and foster the development of Malaysian films and television programmes from domestic filmmakers and producers.

Suffice it to say, Iskandar Malaysia Studios didn’t quite live up to the hype, and in the last decade, industry observers would agree that it rather significantly underperformed, particularly given its steep initial investment, which landed somewhere between RM528 million and RM748 million. The financial backing was provided by Malaysia’s sovereign wealth and investment firm Khazanah Nasional Berhad.

Initially partnered with the renowned Pinewood Studios, the complex carried the name Pinewood Iskandar Malaysia Studios until Pinewood pulled the plug on the partnership in 2019, and the name “Pinewood” was dropped from the studio. It’s not known precisely why the UK studio decided to exit the partnership, but the deal involving the Johor studio had been struck by a previous management team before the Pinewood group was acquired by Aermont Capital in a mega-deal in 2016, with a value exceeding RM1.75 billion.

What is more clear is the recent IMS acquisition price of just RM35.3 million, meaning that the “return” was somewhere in the range of about 5 sen to 7 sen for every ringgit invested. The studio received a valuation of a meagre RM32 million at the end of 2022, according to industry reports, having shed more than 90% of its value.

Along with the hugely struggling if not altogether failed RM20 billion Country Garden megaproject, Forest City, the subsequent “out with a whimper” sale of IMS certainly fuels concerns about the viability of the various large-scale pursuits in Malaysia’s southernmost state. When an investment of more than half a billion ringgit nets a sale of barely RM35 million, it’s hard to brand that as a success.

IMS burst onto the scene with a bit of a bang, serving as one of the principal filming locations for the big-budget Netflix drama series Marco Polo, which premiered in December 2014. Though the series ran for two seasons, a third was cancelled, and industry reports showed the series resulting in a US$200 million loss for Netflix. Of course, the financial shellacking of the series can hardly be blamed on the shooting location, but for those who look for “signs,” maybe this was one of the first.

Though some scenes for the Chinese action film Skyfire were subsequently shot at IMS, the costly studio complex didn’t see much more in the way of global film attention for the rest of the decade, largely being used for smaller-scale local and regional productions, including some “reality TV” programmes. Some pick-up scenes for the popular 2018 film Crazy Rich Asians were reportedly shot at IMS, but notably more principal photography actually took place in Kuala Lumpur, Penang, and Langkawi.

Perhaps seeing the writing on the wall, IMS investor Khazanah Nasional Bhd’s wholly owned special purpose vehicle, Granatum Ventures Sdn Bhd, recently entered into a definitive share sale agreement to divest its 100% stake in IMS.

According to local reports, Khazanah sold the stake to a company called Studio Management Services Sdn Bhd (SMS), with the media spin being that this sale was to facilitate the attraction of foreign investment, future partnerships, and investment opportunities for Malaysia – which, ironically, was kind of the pitch made about IMS itself over a decade ago. However, the story doesn’t end there.

Now, as reported by trade publication Variety, Singapore-based content provider GHY Culture & Media has paid RM8.8 million for an 80% stake in SMS to RK Media Ventures Sdn Bhd and CL Media Holdings. GHY primarily produces Chinese-language content.

According to a regulatory filing GHY and SMS must pay a further RM26.5 million within five days to state-owned Granatum Ventures to buy 100% of IMS. That results in a total purchase price of RM35.3 million for a controlling 80% stake. The remaining minority can be bought out in five years.

Reporting from Variety, Channel News Asia, Free Malaysia Today, and Malaysiakini contributed to this article.