>From http://biz.thestar.com.my/news/story...1&sec=business
PETALING JAYA: Time may be running out for Astro All Asia Networks Plc's plan to expand into Indonesia's pay-TV business as its trademark and licensing agreement with PT Direct Vision (PTDV) will expire on Sept 1. Astro supplies channels and programming content and also provide technical support to PTDV. It also allows PTDV to use the "Astro" brand in the hope of acquiring a 20% stake in PTDV. In the first quarter ended April 30, Astro said it provided RM68mil, or about RM23mil a month, to support PDTV's operations. If no agreement is reached by Sept 1, Astro has said it would account for costs relating to commitments to PDTV amounting to about RM200mil. When contacted, Astro told StarBiz it was unable to disclose the status of the negotiations. However, an analyst with a local research firm was not optimistic on the negotiations due to regulatory risk and heavy Indonesian lobbying against PTDV. If the deal did not go through, the analyst said it would free Astro's cashflow to the tune of about RM23mil a month. The biggest drawback would be Astro missing out the opportunity to use PTDV as a platform to penetrate into Indonesia untapped market, said the analyst. Meanwhile, OSK Investment Research believes talks were still inconclusive and both parties had reached a stalemate. However, it said the deadline could indirectly compel both parties to agree on a deal, which might be positive for Astro. The research house said there were three options. The first would be for PTDV to buy out Astro's content rights and the second option was for Astro to work with a new partner to take over Lippo group's share. The final option was for Astro to exit from the deal. "Option three is clearly the least popular considering Astro had poured in heavy investments and the huge market potential in Indonesia (pay-TV penetration is less than 10%)."
