Telkom to finance AriaWest's operation

Telkom to finance AriaWest's operation

JAKARTA (JP): State-owned telecoms company PT Telkom said it
would provide operational funds for the West Java and Banten
telecommunications regions, managed by PT AriaWest International,
for as long as the dispute between the two companies continued.

Telkom's director of operations and marketing Komarudin
Sastrakoesoemah said on Friday that Telkom would lend the money
to the telecommunications regions so that their day-to-day
operations would no longer suffer the impacts of the dispute.

"We will invite the management of the regions, AriaWest and
also the government to a meeting (next) Monday to discuss the
payment procedures," he told The Jakarta Post.

A protracted dispute between Telkom and AriaWest, which
centers on the buyout price of AriaWest's assets and operations
by Telkom, has affected the day-to-day telecoms operations in
both regions.

Telkom's employees have yet to receive their June salaries
from AriaWest and state electricity company PT PLN has yet to
receive payment for its power bills due in June.

Earlier, Komarudin said PLN had threatened to stop power
supplies to the West Java and Banten telecoms facilities unless
Telkom and AriaWest paid the Rp 1.3 billion (about US$115,000)
bill by next Wednesday.

Telkom is ready to dole out between Rp 30 billion and Rp 40
billion each month to help the regions meet their basic needs,
including paying salaries and power bills, he said.

"We are prepared to do this until the dispute has been
resolved or, if worse comes to worst, until a verdict comes from
the arbitration panel," Komarudin told the Post.

AriaWest has started arbitration proceedings against Telkom in
Paris on charges that the state company failed to respect their
joint operation (KSO) contract.

Komarudin said the money Telkom spent to finance the West Java
and Banten operations would be discussed once it reached a
dispute settlement with AriaWest.

Komarudin asserted the move had nothing to do with the
government's plan to appoint an independent management team to
take over the telecoms operations in the regions until Telkom and
AriaWest settle their dispute.

"This is an alternative that we think is best.

"The government can decide for itself whether or not an
independent team is still necessary," he said. (tnt)