Channel 10 stars react to American buyout
IT WAS just another day in the office for Studio 10 anchor Sarah Harris - until the news broke that Network Ten had been bought out.
The troubled network will be taken over by US giant CBS Corporation in a deal announced on Monday morning, while Harris and co-anchors Denise Drysdale and Joe Hildebrand were live on air.
With a stunned look no doubt shared by the many commentators who had expected the deal to go to Ten shareholders Lachlan Murdoch, Bruce Gordon and James Packer, Harris informed viewers that "one of the largest media companies in the world has entered an agreement to acquire Network Ten".
The news was met with a dramatic gasp by Drysdale and raised eyebrows from Hildebrand, who quipped: "I, for one, welcome our new American overlords."
"CBS and Ten have had a close and strong relationship for almost two decades," Harris said "CBS is one of our key c partners and has owned a third of [Channel] 11 since it was launched in January 2011. Now, this agreement represents an exciting opportunity to develop and grow Ten across multiple platforms - with CBS as our owner."
She promised to keep viewers updated with "further developments and next steps".
The receivers and voluntary administrators of Ten Network Holdings announced the deal for CBS to buy the ailing network on Monday morning, saying that it followed "a rigorous sales process".
"Network Ten has played a significant role in Australia's media landscape over many decades, and the sale of the business to CBS will allow the iconic broadcaster to move into a new chapter on a strong and stable footing," said PPB Advisory Partner Christopher Hill, one of Ten's receivers.
CBS Studios International chief executive Armando Nunez said the American broadcaster planned to reverse Channel 10's fortunes.
"CBS recognises the significance of Ten in the Australian broadcasting community," Mr Nunez said.
"We are committed to the efficient, reliable and successful turnaround, operation and development of Ten to support continued growth in Australian media".
Ten chief executive Paul Anderson said the CBS acquisition would continue the relationship the two networks already had over the licence rights of its US content.
"CBS and Ten have had a strong relationship for a number of years; we are very excited about further developing that relationship with CBS as an owner and strength that they will provide to the Company at this critical time," Mr Anderson said.
The network was placed into voluntary administration in June, after Ten's billionaire shareholders Lachlan Murdoch, Bruce Gordon and James Packer decided against guaranteeing a new $250 million loan to replace the existing $200 million overdraft from the Commonwealth Bank.
Administrator Jarrod Villani of KordaMentha said the company's receivers and administrators would "work closely together to ensure that operations continue uninterrupted while the transaction is finalised".
"As part of the agreement to purchase the Network Ten business, CBS will provide immediate financial support to ensure continuity of operations ahead of the upcoming meeting of creditors," he said.
SURPRISE DEAL ENDS MURDOCH BID
Today's announcement puts an end to speculation of a takeover by Lachlan Murdoch and Bruce Gordon, which hinged on changes to media laws.
The ACCC reviewed factors including how a takeover would expand "Murdoch interests" in Australian media and how competition for supply of news services would be affected, concluding that such a deal would not lessen competition.
CBS Corporation is listed on the New York Stock Exchange, and has a current market capitalisation of $US28 billion.
A key content provider to Ten, it operates businesses which span the media and entertainment industries, including the CBS Television Network, cable networks, content production and distribution, television stations, internet-based businesses, and consumer publishing.
As part of today's deal, CBS will also launch its digital subscription on-demand service CBS All Access in the Australian market, Mumbrella reports.
The deal will involve an acquisition of Network Ten by CBS, with a refinance of existing secured debt arrangements (including shareholder guarantor fees) in full and a Deed of Company Arrangement that will be put to creditors at the second creditors meeting.
Further details on the expected return to creditors and timing of the second creditors meeting will be provided by the Voluntary Administrators in their Report to Creditors to be released in the coming days, KordaMentha said.