Creditors back CBS over Bruce Gordon and Lachlan Murdoch for Channel 10

The Channel Ten building in Sydney. William West/AFP/Getty Images

A meeting of Ten creditors today approved a bid by American broadcaster CBS to acquire the Australian free-to-air-network.

The US-based network had increased its offer, heading off a renewed bid by Australian billionaires Bruce Gordon and Lachlan Murdoch.

TV pioneer Gordon and Twenty-First Century Fox executive chairman Murdoch had offered Ten’s unsecured creditors, excluding CBS, $35 million, or 13.40 cents in the dollar, compared with $32 million, or 12.43 cents, in the original CBS deal preferred by administrators KordaMentha.

However, CBS increased its payout to $40.58 million for unsecured creditors, according to documents filed by company administrator KordaMentha.

Part of the change includes a better payout for Twenty-First Century Fox, which would now get $12 million under the CBS bid instead of $3.42 million.

At a second meeting of creditors today, a vote was carried in favour of CBS.

Network Ten receiver and manager, and PPB Advisory Partner, Christopher Hill, said the approval of CBS ensures the iconic broadcaster continues on a “strong and stable footing” under the ownership of one of the world’s largest media organisations.

The full acquisition of Network Ten is subject to Foreign Investment Review Board approval.

The CBS bid is valued at more than $216 million, including $139.1 million to repay secured creditors including the Commonwealth Bank.

The network went into voluntary administration in June after Gordon and Murdoch, both significant shareholders, refused to increase or extend a $200 million credit facility past December.

Ten in April posted a loss of $232.19 million for the half year in a tough advertising market. At that time, the company said the current debt facility was drawn down by about $66.2 million.

Earlier in the year analysts described the network as “un-investible” for most investors because of operating losses and funding concerns.

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