Asia Pacific to sue three members of Wang family

Asia Pacific Broadband Telecom Co (亞太固網寬頻), a debt-ridden fixed-line operator, yesterday said it will sue three of the Wang family members allegedly involved in an embezzlement case.

The company will go to the Taipei District Prosecutors' Office today to launch litigation against Gary Wang (王令麟), Wang You-theng (王又曾) and Wang Chin She-ying (王金世英) for breach of trust, said Lee E-hua (李宜樺), public relations director of Asia Pacific Broadband, at a press conference.

A new management team that includes Lee and acting chairman Springfield Lai (賴春田) came on board recently to review finances of Asia Pacific Broadband as part of the government's plan to appoint auditors in January to oversee the troubled operator.

The telecom firm comes under the Rebar Asia Pacific Group (力霸亞太企業集團), which has been embroiled in financial scandals for months, with Wang You-theng and Wang Chin She-ying fleeing the country.

Lee said that the Wangs had embezzled funds through the sale of Asia Pacific Broadband's cable modem business to Tung Ho Multimedia Co (東禾媒體), as well as the sale of Eastern Multimedia Co (東森媒體科技) to the Carlyle Group.

The sale of the cable modem division to Tung Ho failed to get approval from the company's shareholders and its board of directors, with the final price fixed at NT$2.64 billion (US$79.5 million) -- a NT$610 million shortfall initially agreed to by the board.

"Cable modems were a very important business to the company and it shouldn't have been sold," Lee said.

She said the cable modem division was the second-most lucrative branch of Asia Pacific Broadband, accounting for some 20 percent of total sales and 18 percent of gross margins each year.

By bundling in the lucrative cable modem business, the Wangs then sold Eastern Multimedia, which owned Tung Ho, to the Carlyle Group in July last year for NT$47.6 billion, she said.

The takeover price of Eastern Multimedia was NT$5.22 billion more than the

original price assessed by accounting firm, Lee said.

“We believe the Wangs pocketed the money through these sales,” Lee said.

But Gary Wang denied the allegations in a statement yesterday, saying that

all transactions had been recorded in official documents and that he would

sue the new management of Asia Pacific Broadband.

The fixed-line provider is scheduled to hold an annual shareholder's meeting

next Monday, aiming to revamp the board previously controlled by the Wang

family, which has strongly opposed introducing new investors and a corporate

overhaul.