Lachlan Murdoch and Bruce Gordon have launched a formal bid for Australia’s troubled Ten Network. The bid is a direct challenge to CBS Corp.’s proposed acquisition of Ten from financial administrators.
The bid by Murdoch’s Illyria investment company and Gordon’s Birketu follows a successful court challenge Tuesday to the CBS proposal, which was put forward last month. The court ruling in Sydney delayed a vote by creditors on the CBS rescue plan. But Murdoch and Gordon’s bid may itself be ruled inadmissible because it missed an Aug. 25 deadline.
Significantly, the Illyria-Birketu bid also follows the passage this week of new media laws that will relax rules on cross-media ownership and media plurality. The Murdoch family-owned News Corp. is already the dominant media group in Australia. Lachlan Murdoch is executive chairman of 21st Century Fox.
According to Australian media, the Illyria-Birketu bid puts more cash on the table for creditors. CBS, which is Ten’s biggest creditor, had offered A$32 million (US$25.5 million). In an earlier informal offer, Illyria-Birketu proposed A$35 million (US$28 million). The new takeover offer ups that to A$55 million (US$44 million).
Unlike CBS’ offer, which would give it outright ownership, the Illyria-Birketu bid proposes returning 25% of Ten’s equity to existing shareholders. Murdoch and Gordon also say that Ten could in time be re-floated on the Australian Stock Exchange.
Ten was forced to go into administration earlier this year after media moguls Murdoch, Gordon and James Packer withdrew their guarantees to provide credit to the company. It is Australia’s third-ranking free-to-air broadcast group.
The CBS bid had been approved by administrators KordaMentha. According to a second report published by the administrators, Illyria and Birketu would renegotiate leases on three of Ten’s studios. Job losses may follow, especially if Ten’s news operations are combined with those of Sky. CBS has promised that jobs will not be cut.