The Ten Network has finally announced a capital raising with Foxtel investing $77 million for a 15% stake and its string of billionaire shareholders adding millions more.
The total raising is $154 million. which will allow the troubled free to air network to pay down debt.
Billionaires Gina Rinehart, James Packer and Lachlan Murdoch are all expected to take up their entitlements at 15 cents a share.
Ten, the home of MasterChef, has been seeking a capital injection, in return for equity, for some months. It spoke to several suitors but in the end opted for a complicated deal with Foxtel.
Other elements include a two-year option for Ten to become a 10% shareholder in Foxtel’s online streaming service Presto.
As part of the deal, Ten will also get a 24.99% stake in Multi Channel Network (MCN), the Foxtel and Fox Sports joint venture for advertising sales.
Executive chairman Hamish McLennan said: “The agreements with Foxtel and MCN will materially enhance Ten’s business and better equip it to respond to the challenges of the ever-changing media and advertising landscape. We welcome Foxtel’s proposed investment and we are confident this proposal will drive value for all of Ten’s shareholders.”
Richard Freudenstein, Foxtel’s CEO, says the proposal delivers the best solution for a revitalised, competitive and profitable Ten.
Ten lost $168.3 million in the year to the end of August in a soft advertising market.
Its shares are down 2.8% to $0.258