Kabelvision teams up with Malaysian Astro for multimedia service
The Jakarta Post Jakarta
PT Broadband Multimedia Tbk., better known as cable TV operator Kabelvision, and Malaysian cross-media operator Astro All Asia Network Plc., have agreed to set up a joint venture company to provide multi-channel satellite and multimedia services in Indonesia.
The partnership will invest US$1 billion over the next five years. Astro will hold 51 percent of the shares in the joint venture company, and Lippo Holdings, Kabelvision's parent company, 49 percent.
The deal was made against the backdrop of tension between the Indonesian and Malaysian governments over the Ambalat block oil field.
"The Astro-Lippo joint venture company will have an initial combined shareholder's fund of $65 million," the Malaysian firm said in a media release on Tuesday.
Additional cash funding is expected to be raised through a combination of third party loans, equity and other instruments.
"We have been very focused on expanding our digital multimedia platform into Indonesia as it is a natural market extension for us," Astro group chief executive officer Ralph Marshall said.
Citing the growing telecommunications services sector in Indonesia, the joint venture will be in a strong position to provide interactive multimedia content using Kabelvision's existing network.
"This is an area where Astro has significant skills and capabilities, and is consistent with our stated strategy of expanding our multimedia business in the region," Kabelvision CEO Marshall Cooper said.
The new joint venture is targeted to reach 10 million homes, representing about 25 percent of the local market, within five years.
Kabelvision started operations in the early 1990s, along with Indovision.
The main difference between the service providers is their means of transmission. Indovision subscribers must use satellite dishes, while Kabelvision is distributed via optical cable.
Kabelvision also provides broadband Internet.
Astro is Malaysia's leader in commercial radio and publishes the high-circulation magazine, The Astro Guide.