21st Century Fox has thrown its weight behind a legal challenge to CBS’ proposed deal for Australian free-TV network Ten. The U.S. media giants faced off in a Sydney courtroom Tuesday, with Fox joining an attempt by Lachlan Murdoch and others to block the CBS takeover of the Australian broadcaster.
CBS and Fox are the two major creditors of financially troubled Ten, which went into receivership earlier this year. Documents released this week show that the CBS deal is valued at a minimum A$201.1 million ($161.2 million). That would cover creditor payments and A$30 million of working capital for Ten, ranked third among Australia’s commercial terrestrial networks, behind Nine and Seven.
Ten’s largest shareholders, Rupert Murdoch’s son Lachlan and Win Television owner Bruce Gordon, were already opposed to the CBS deal, and Fox has now aligned itself with them. Opponents of the agreement allege that an alternative bid for the broadcaster from Gordon’s company, Birketu, and Murdoch’s Illyria Nominees Television was not properly put to creditors by the administrator, KordaMentha.
The administrator says there are other factors at play, including possible media ownership complications associated with a Birketu/Illyria bid, which could mean creditors facing a lengthy wait to get paid.
Both Fox and CBS had rich programming deals with Ten. Fox is owed an estimated A$195 million, while CBS, if successful in its takeover bid, would waive its own claims and seek to renegotiate the Fox content pact. Fox would get a one-off payment capped at A$3.4 million payment if those efforts fail.
A key meeting of creditors had been set for Tuesday but has been rescheduled for Sept. 19. Birketu and Illyria contend that CBS should not be allowed to vote at that meeting. The New South Wales Supreme Court hearing continues.