Ten takeover by CBS wins FIRB approval

The Foreign Investment Review Board has approved Ten’s sale to CBS, leaving just one court hearing to seal the takeover.

Little now stands in the way of CBS’s takeover of Ten. Pic: AFP

The Foreign Investment Review Board has approved Network Ten’s sale to CBS, leaving just the court approval of the transfer of company shares to finalise the takeover.

Ten Network Holdings today announced to the market that the FIRB had advised the Commonwealth it had no objection to the TV company’s acquisition by the US broadcaster.

The approval, needed for a foreign-owned company to buy an Australian business, was expected.

A Supreme Court hearing beginning on October 31, and expected to run over two to three days, is the final hurdle for the deal.

With Bruce Gordon and Lachlan Murdoch having declined to challenge the transfer, the CBS takeover is considered to be inevitable, after administrator KordaMentha released an independent expert report prepared by KMPG that declared Ten’s shares “worthless”.

The auditor’s analysis pegged the company’s value at between negative $1.05 billion and negative $529.2 million when its debts were taken into account, including hefty contract obligations to CBS and 20th Century Fox.

It said Ten’s business would need to have a net value of $646.9m in order for its shares to have any value, well above the $112m it was worth under the best-case scenario.

However, two retail shareholders have filed appearances with the court and will attempt to block the deal.

David Gubbay and Yunfeng Du have flagged a potential constitutional challenge to the power of companies to acquire investors’ shares against their will.

At a court hearing on September 27, counsel for Ten’s receivers Tiffany Wong sought the earlier possible hearing date, noting the difficulty of running a television network under administration — in particular negotiating content deals.

“If one can’t get content, one can’t get advertisers,” Ms Wong told the court, saying the company’s future hinged on the expedition of the proceedings.