The situation is believed to be a result of a much-publicised dispute between tycoons Anand Krishna and James Riady, who head Astro and Lippo, respectively.
In August, Astro announced its decision not to renew its contract with DV, which lapsed on August 20. However, the Malaysia company has decided to extend its service agreement on two occasions, first until 30 September and then until 19 October. It had also allowed DV to use the ‘Astro’ name under the trademark licence agreement, on the condition that DV settles its outstanding payments to Astro.
In August, Astro announced its decision not to renew its contract with DV, which lapsed on August 20. However, the Malaysia company has decided to extend its service agreement on two occasions, first until 30 September and then until 19 October. It had also allowed DV to use the ‘Astro’ name under the trademark licence agreement, on the condition that DV settles its outstanding payments to Astro.
Astro now says that as no payments have been received from DV, its board of directors have decided to cease all support and services and to terminate the trademark licence agreement.
“Astro has supported PT DV since February 2006 in the belief that arrangements that would have allowed it to invest in PT DV would be concluded,” said Astro legal counsel Todung Mulya Lubis. “But since it has been more than two years and there is no indication that any such arrangements will be concluded or that Astro will be paid for the support and services that it has provided, its Board has determined that it has no option but to terminate its support to PT DV.”
Until now, Astro was providing broadcasting services, information technology services, satellite reception equipment leasing and channel supply services to Direct Vision.
According to Todung, Astro has not been compensated for Rp 2.5 trillion (US$ 250 million) worth of support and services given to DV.“This situation has arisen purely as a result of a commercial dispute between Astro and Lippo Group in relation to the non conclusion of the proposed joint venture between the parties in PT DV.”
