Network Ten to be placed in voluntary administration

UPDATE: Fans of top-rating shows The Project, MasterChef and The Bachelorette have been assured programs will not be culled mid-season after the Ten Network was today placed into voluntary administration.

• Ten likely to be bought by private equity or billionaire

FANS of top-rating shows The Project, MasterChef and The Bachelorette have been assured their programs will not be culled mid-season after the Ten Network was today placed into voluntary administration.

Media experts said buyers are lining up to purchase the station.

The flagship programs provide Ten with valuable advertising revenue and whoever buys the TV channel would want them to remain on Ten, Fusion Strategy media analyst Steve Allen told The Daily Telegraph.

Ten Network talent Waleed Aly and Carrie Bickmore from The Project.

“There would be lots of venture capitalists both locally and overseas that would look at this as a cost opportunity,” Mr Allen said, suggesting Hungry Jacks owner Jack Cowin and mining magnate Gina Rinehart as potential interested parties.

The embattled network was placed into voluntary administration just days after two major shareholders declined to support a new funding deal for the loss-making network.

The company said in an announcement to the Australian Securities Exchange this morning that Mark Korda, Jennifer Nettleton and Jarrod Villani of Korda Mentha had been appointed as voluntary administrators.

Uncertain future at Network Ten.

The administrators told Ten they would work closely with management, employees, suppliers and content partners while they undertook a financial and operational assessment of the business.

“During this period, the administrators intend to continue operations as much as possible on a business as usual basis,” the ASX announcement said.

Shares in Ten have been suspended from the stockmarket.

The board of Ten said in a statement that they “regret” the circumstances.

“The directors of Ten regret very much that these circumstances have come to pass. They wish to take the opportunity to thank all Ten employees and contractors for their commitment and enthusiasm for Ten’s programs and business,” the ASX announcement said.

I'm thinking about colleagues at Network Ten today. These are challenging times and good people are caught up in them x

— tracy grimshaw (@tracygrimshaw) June 14, 2017

“They wish Ten and its management all success in the future as the administrators look to the potential sale or recapitalisation of the business.”

Ten is the country’s third-placed commercial broadcaster, responsible for franchises such as MasterChef Australia, I’m A Celebrity ... Get Me Out Of Here and The Bachelor.

Company secretary Stuart Thomas told shareholders investment companies Illyria and Birketu did not plan to ­extend their guarantee for lending to the broadcaster.

Ten has a $200 million debt facility from the Commonwealth Bank that is backed by its key shareholders and due to expire on December 23.

Sophie Monk in the next Bachelorette. Source: Network TEN

Expensive programming such as MasterChef Australia could be in jeopardy.

The network had been seeking a $250 million loan to replace that facility but Illyria and Birketu, the respective investment vehicles of Lachlan Murdoch and Bruce Gordon, have declined to renew their guarantee.

The company said Ten has identified a number of cost saving initiatives which are expected to have a positive impact on earnings to the tune of $50 million in financial year 2018, and potentially more than $80 million per annum by financial year 2019.

Lachlan Murdoch.

Bruce Gordon.

Ten said it has also agreed in principle with its US content partners Fox and CBS to discount the value of its $150 million per year contract by about 50 per cent.

The broadcaster also said if the federal government’s proposed changes to TV licence fees are passed in parliament tomorrow, Ten will save $22 million in financial year 2017 and $12 million in financial year 2018.

WHAT NOW FOR YOUR FAVOURITE TEN SHOWS?

Big Bash commentary team. Picture: Channel 10

Cashed-up private equity firms and Australian billionaires have been earmarked as potential buyers, meaning there is no danger of the broadcaster — which boasts audience favourites such as The Bachelorette, Gogglebox, MasterChef Australia, I’m a Celebrity and the Big Bash cricket — going off air.

I'm A Celebrity, Get Me Out Of Here! winner Casey Donovan with contestants Dane Swan and Natalie Bassingthwaighte in South Africa. Picture: Dylan Robinson

Media analyst Steve Allen predicts Ten will be sold off to the highest bidder.

He said Ten’s shares collectively were worth about $60 million, which is cheap for a television licence in Australia.

“I would have thought in the long run $60 million for a free-to-air TV licence in Australia with a bunch of programming commitments and a couple of contracts to be ­renegotiated could mean the network survives profitably and would be very tempting (for a buyer),” he said.