Update: In a statement, the AskMe Group fired back at Astro and said that it was incorrect to call the company insolvent. It added that the closure costs associated were $76 million and were recorded in minutes of a meeting between the two companies. The full statement* :
“Astro is now trying to hide behind new excuses of not paying salaries and vendors by levelling baseless allegations against minority shareholders and operating management of wrongdoing and forensic audit. Minority shareholders and operating management challenge them to appoint neutral party like KPMG or Deloitte.
And challenge them to release publicly the audit committee minutes and all correspondence since April 30th.
It may be reminded to Astro that all three audit commitee members were their own nominees and the CFO was their appointee and reporting to them as per shareholders agreement.
They are already chargesheeted by CBI and ED for fraud and cheating and money laundering in this country and are absconders under the Indian judicial system. Astro has invested 275 million dollars into the company over a period of 6 years!!! From 2010 including various promoter and company acquisitions and bank interest.
We request MediaNama to ask Astro to make public all correspondence with the company since 30th April till date and also the minutes of the board meetings and audit commitee meetings.Astro owns Askme at 98.5 percent and all actions are taken under its directions.
It is now trying to flee the country and not pay dues under the new excuse of forensic audit”
Earlier: Malaysian media company Astro Entertainment Networks Limited (AENL) will be ordering a forensic audit of AskMe Group’s parent comapny Getit InfoServices. This follows AskMe group shutting down its operations in the light of not being able to pay its employees and manage other costs running the business.
“An independent review by advisors has concluded that there is little prospect for turnaround and the business is insolvent. AENL intends to appoint a forensic auditor to review Getit’s books and will take appropriate steps based on the results of that audit,” the company said in a statement.
The shut down follows a limbo that the AskMe and Astro management got into after AskMe proposed to buyout its stake from Astro for a supposed $5 million. AskeMe is owned by Getit Infomedia. The company also said that it has made “sustained and long term investments in Getit totalling nearly $300 million to date to keep the business afloat.” MediaNama was unable to independently verify this.
Astro acquired a 50% stake in Getit Infomedia for around $20 million in 2010.
MediaNama has tried getting in touch with several members of AskMe’s and Getit’s senior management. Calls and emails were not answered and we will update once we hear back from them.
At the start of this month, unnamed employees at the AskMe Group wrote an open letter to Astro asking it to pay all outstanding dues till July 2016. The open letter came 2 months after there were between 300 to 650 employees reportedly laid off at the company.
About 10 days ago, Manav Sethi, Group CMO & head of digital strategy at AskMe Group told MediaNama that the company did not have enough money to sustain its operations and support its 2,500 strong workforce because Astro was supposed to pay it by 31 July, which did not happen.
Following this, on 9 August, the ‘Salary’ department at AskMe sent an email (of which MediaNama has a copy) to all its employees asking them to get in touch with Astro to get their salaries, because Astro was supposed to pay AskMe $5 million by 5 August. The email listed the names, phone numbers and email IDs of the Astro management for the employees to contact.
Astro’s India issues are piling
To The New Digital (TTND), a digital services company, is looking to buyout Astro’s 85% stake in the company, given that Astro had not paid it for the services offered by TTND. Astro All Asia Networks Ltd had been charge sheeted by India’s top investigating agency CBI in the Aircel Maxis case, where money laundering has been alleged. More on that here.
* AskMe group sent a revised statement to MediaNama which was updated.