Indonesia firm takes scorched earth approach to frustrate Ananda’s ASTRO
KUALA LUMPUR, March 8 — Indonesia’s First Media has secured the bankruptcy of its holding firm in Jakarta in a bid to frustrate efforts by Malaysian billionaire Ananda Krishnan’s ASTRO to recover funds from a soured joint venture, Singapore’s The Straits Times reported today.
First Media won the order after lodging the unexpected filing to wind up parent company Across Media with the Jakarta commercial courts.
Across Media, a unit of Hong Kong-based Lippo Group controlled by the republic’s Riady family, is currently locked in a legal battle with Ananda’s satellite TV provider ASTRO over the sum of US$44 million (RM137 million).
The amount is part of a larger US$250 million award made in favour of ASTRO in February 2010 by the Singapore International Arbitration Centre (SIAC) following the fallout over the failed TV joint venture.
First Media has filed an appeal over the decision, which is due to be heard in April.
Ananda’s ASTRO had in 2011 secured a garnishee order in Hong Kong for the US$44 million plus interest, alleging Across Media had mischievously transferred the sum to First Media in a bid to prevent the enforcement of the SIAC award.
This ruling was also challenged by First Media, but this was later set aside by a Hong Kong court, prompting the firm to shift the battlefield to Jakarta, where it won an arbitration order for it to be paid the US$44 million by parent Across Media.
Across Media then filed for bankruptcy protection in a bid to delay the payment, but was ordered to provide a supervised debt restructuring plan for creditors’ approval.
It did not do so, however, leading to the current bankruptcy proceedings.
The Indonesian decision has not been well received in Hong Kong, where a High Court alleged that “whole purpose of these actions to frustrate the Hong Kong process”.
“There is no credible explanation as to why First Media had to take the drastic action in bankrupting its own parent company,” the Hong Kong court said.
The acrimony stems from a failed pay television venture, partly owned by unit of First Media in partnership with ASTRO from 2006 to 2008, to provide satellite television service for Indonesians under the ASTRO Nusantara trademark.
ASTRO Nusantara ceased operations in October 2008 due to a commercial dispute between ASTRO and Lippo Group.
The row previously saw Indonesian police seeking Ralph Marshall, the right hand man of Ananda, over fraud and money laundering charges in relation to the deal gone wrong.
Marshall had earlier been accused of forging documents that resulted in some US$90 million in losses for the failed pay TV venture.