Business: Rescue effort means you can stay tuned to Channel 10

BILLIONAIRES Lachlan Murdoch and Bruce Gordon have partnered up to rescue the embattled Ten Network.

Ten has been placed into voluntary administration

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BILLIONAIRES Lachlan Murdoch and Bruce Gordon have partnered up to rescue the embattled Ten Network.

Mr Murdoch, co-chairman of News Corp, publisher of The Daily Telegraph, and Mr Gordon, owner of regional TV powerhouse WIN Corporation, have agreed to work ­together to explore a potential financial restructure of Ten, which has been placed into voluntary administration.

Collectively the two businessmen own 22.7 per cent of the shares in Australia’s third largest commercial broadcaster. One share is now worth just 16c, valuing Australia’s third largest commercial TV station at about $58 million.

READ MORE: Network Ten’s future in the balance as key investors withdraw

Lachlan Murdoch. Picture: Dylan Robinson

WIN owner Bruce Gordon at the AGM. Picture: John Feder/The Australian.

Wednesday, the Ten board was forced to appoint administrators Korda Mentha just days after Mr Murdoch and Mr Gordon declined to support a new $250 million financing deal to keep the broadcaster solvent.

Korda Mentha partner Mark Korda said Ten, home of hit shows such as MasterChef and The Bachelor, would continue to operate on a “business as usual basis” while his team worked closely with management, employees, suppliers and content partners as they undertake a thorough assessment of the business.

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“Network Ten is a quality free-to-air TV network with a rich history of broadcasting well-known Australian television content,” Mr Korda said. “The administrators are confident that the network is an attractive asset which will find a buyer or will be recapitalised.”

Ten has been placed into voluntary administration

The new shareholding emerged when a letter from Mr Gordon’s private investment vehicle Birketu addressed to Mr Murdoch’s private investment vehicle Illy­ria was made public.

“In the event of a default by Ten of its obligations under the existing facility, there is a risk of Birketu and Ilyria each being exposed to significant liability under their respective guarantees together with a complete loss of their respective investments in Ten’s equity,” the letter posted to the ASX said.

“In such circumstances, given the commonality of the parties’ interests in Ten as shareholder guarantors of Ten’s debt, it may be in the parties’ respective commercial interest to consider whether a proposal could be formulated and agreed between Birketu and Ilyria under which Ten’s existing secured debt would be repaid and any guarantee support would be removed over an appropriate period.”

The June 9 letter said the terms and conditions of the restructure proposal are yet to be agreed and there is no assurance any proposal will be made. It also states the collaboration does not constitute a takeover bid for the broadcaster, as neither of the parties can do so due to existing media laws.

Originally published as Business: Rescue effort means you can stay tuned to Channel 10