Ten investors may sue as takeover freezes them out

DISGRUNTLED Ten Network shareholders are considering a class action against the troubled broadcaster as they face receiving no compensation under the takeover proposed by US media heavyweight CBS.

Australian Shareholders Association director Allan Goldin said preliminary talks had been held with law firms about a class action after some shareholders contacted the association and expressed their concerns.

“Class actions are very difficult and whether that is a possibility or if it’s not, it’s really too early to say. But sure, we are having talks,” Mr Goldin said.

The surprise CBS deal, announced to the Australian Securities Exchange on Monday, includes ownership of Ten’s digital channels and growing digital platform Tenplay.

Details about the financial terms are to be released later this week and it is expected secured creditors will be paid.

A guarantors’ fee owed to major shareholders Lachlan Murdoch, Bruce Gordon and James Packer for their part guaranteeing Ten’s current finance package is also expected to be paid.

But shareholders are tipped to receive no compensation for their shares being hoovered up by the broadcaster.

It is understood that, subject to court approval, CBS would acquire 100 per cent of Ten’s shares in a process that requires demonstrating the shares are worthless given the size of the secured and unsecured claims.

Mr Goldin said the ASA had written to Treasurer Scott Morrison, asking that CBS amend its offer so shareholders did not miss out.

He said the association was hoping to have a discussion with one of Mr Morrison’s advisers tomorrow. “What the results of that will be we do not know,” Mr Goldin said.

The deal came as a surprise to the ASA, which expressed disappointment the network would be leaving local hands.

“It is just like anything, you’d prefer Australian assets to stay in Australian hands if possible,” Mr Goldin said.