PETALING JAYA: Electric and electronic goods manufacturer Sony (M) Sdn Bhd has obtained a court order to wind up Asian Broadcasting Network (M) Sdn Bhd (ABN) which, four years ago, had marketed itself as a serious rival to Astro in the pay-TV sector.
Lawyer Alwin Rajasurya, who appeared for Sony, said the order obtained early this month paved the way for the liquidation of ABN’s assets.
“A private liquidator has been appointed to sell ABN’s properties to pay its creditors,” he told FMT.
It is estimated that ABN has a debt of RM400 million, about RM200 million of it owing to Bank Pembangunan Berhad.
Alwin said the rest of the debt was divided among about 100 creditors, many of which were small scale industries.
“My client started the winding up petition in January last year as ABN was unable to settle debts amounting to RM7 million for the supply of broadcasting equipment,” he said.
He said ABN had obtained several stays from the High Court, stating that it had investors coming in from China.
However, none of that materialised and as such the court wound up ABN on May 8.
Joining Sony in the winding up petition were ARRIS Solution Inc, ARRIS Technology Inc, ARRIS Solution Malaysia Sdn Bhd, MaxNet Enterprise Sdn Bhd, Gentlelite Electrical Sdn Bhd, Pixel Softek Sdn Bhd and Janacon Trading Sdn Bhd.
Despite a RM450 million loan from Bank Pembangunan, ABN ran into problems, including a delay in salaries to staff and payments to installers and service contractors.
The company’s financial statement for financial year ended June 30, 2014, was not available from searches with the Companies Commission of Malaysia, indicating it had yet to file its statements, The Edge Financial Daily reported in April 2015
However, records filed for the financial year of 2013 showed accumulated losses of RM36.2 million, including losses of RM30.7 million for the year.
Non-current and current assets stood at RM189.89 million and RM22.79 million, respectively compared with non-current and current liabilities of RM102 million and RM38.82 million.
Another factor that raised concerns was that ABN has posted zero revenue since financial year 2009.
The question that was raised was how ABN was going to repay the RM450 million loan from government-owned Bank Pembangunan (held by the Minister of Finance Inc and the Federal Lands Commissioner) which was meant to help fund the company’s RM2 billion capital expenditure.
Company financial records showed that the loan has yet to be serviced. So too a RM15 million loan from Malayan Banking Bhd (Maybank) taken in 2012.
The Edge Financial Daily had said details of the loans were sketchy and that Bank Pembangunan had invoked the Banking and Financial Institutions Act as well as the Financial Services Act 2013 in refusing to address media queries, from the time the loan was approved in early 2013.
Signs that things were coming to a head at the company were evident when it shut down its news division in April 2015, taking ABN News off the air and its news portals off the internet, as well as closing the studio unit which supported the news broadcasts.
ABN’s digital cable TV service, marketed as ABNxcess, went live on June 8, 2013, boasting of providing speeds of up to 300 Mbps through its hybrid fibre-coaxial technology for its internet service and broadcasts of over 500 channels.
It had 52 channels, airing mostly programmes from the Indian subcontinent and China.
Tycoon K K Eswaran is the largest shareholder of ABN through a 70% shareholding of ABN Media Group – ABN’s holding company.
The rest are owned by Admiral (Rtd) Mohd Anwar Mohd Nor via Mutu Pedoman Sdn Bhd (10%) and former home ministry secretary-general Mohamad Noor Abdul Rahim via Kurnia Mantap Sdn Bhd (20%).
ABN obtained a five-year digital cable broadcast licence through Nilamas Corp Bhd (as ABN was known then). This licence was activated in 2013.