Gordon, Murdoch lob new Ten bid
The battle for control of Ten Network has taken a new twist after Bruce Gordon and Lachlan Murdoch upped the ante by tabling a revised bid on more “compelling” terms.
The move, prompted by the passing of the media reform bill, will test the resolve of Ten’s administrators Korda Mentha after they backed a rival offer by US media giant CBS that now offers a lower return to creditors.
Less than 24 hours after the Turnbull government pulled off the near-impossible task of scrapping some of Australia’s decadesold media rules, Mr Gordon and Mr Murdoch lobbed a new proposal that could open a bidding war if CBS counters the offer.
At lunchtime yesterday, corporate advisers Fort Street sent KordaMentha a five-page letter outlining Mr Gordon’s and Mr Murdoch’s latest attempt to take control of Ten, home of reality franchise MasterChef and the Big Bash cricket league.
“With the passage of the media reform bill now assured, there are limited conditions to the revised proposal and a single execution path,” Fort Street Advisory wrote to KordaMentha partner Mark Korda.
Under the revised terms, the maximum payment to unsecured creditors has increased by 57 per cent from $35 million to $55m, compared with $32m from CBS.
The revised bid is 72 per cent higher than the proposed payment under the CBS bid. In aggregate, Ten’s unsecured creditors, excluding CBS, will receive 13.4c in the dollar compared with 12.43c under the CBS deal.
The investment companies of Mr Murdoch and Mr Gordon, Illyria and Birketu, employees and continuing trade creditors would receive 100c in the dollar and all other creditors would get 5.75c in the dollar.
Ten will no longer be burdened by a contract with CBS that KordaMentha’s official report describes as “onerous”, the letter states. It remains unclear whether the revised offer will be put to creditors at the second meeting of Ten’s creditors, which is due to be held in Sydney on Tuesday, when they will vote on the CBS bid.
KordaMentha is said to be seeking advice on whether a new bid could be accepted.
CBS, which is based in New York, did not respond to an inquiry at the time of writing.
Under the new structure, Mr Gordon and Mr Murdoch would allow shareholders to keep 25 per cent of their equity, with Ten to be relisted on the ASX.
This would enable Ten’s 17,000 shareholders to share in any recovery.
In contrast, under the CBS bid, the US company would own 100 per cent of the company.
Under the CBS deal, retail shareholders would get nothing for their stock, which prompted concerns from the Australian Shareholders Association and talk of a class action by disgruntled shareholders.
The Gordon and Murdoch deed of company arrangement provides sufficient funds to allow Ten to continue operating and meet obligations to staff.
With the media laws soon to complete their passage through parliament and other conditions removed, the new bid from Mr Gordon and Mr Murdoch had no execution risk, sources said.
Ten would also remained locally owned and operated, with