Gordon Loses Court Challenge to CBS's Bid for Ten Network -- Update
September 17 2017 - 9:51PM
Dow Jones News
By Rob Taylor
CANBERRA, Australia--Australian television entrepreneur Bruce
Gordon and Lachlan Murdoch - the son of media mogul Rupert Murdoch
- have lost a legal bid to thwart the takeover of insolvent Ten
Network Holdings Ltd. (TEN.AU) by U.S. broadcasting giant CBS
Corp.
Mr. Gordon and News Corp. (NWS) Co-chairman Mr. Murdoch had
challenged the proposed 201 million Australian dollars (US$161
million) buyout of Ten Network in court, arguing their bid to buy
the company wasn't properly considered by insolvency specialists
KordaMentha in deciding to favor CBS's bid last month.
On Monday, however, the Supreme Court in New South Wales state
dismissed the challenge, clearing the way for a meeting of
creditors' on Ten Network's future on Tuesday.
"I am not satisfied that the plaintiffs have established that
any deficiencies … such as to warrant orders requiring that further
information be provided to creditors or that the second creditors'
meeting be restrained," judge Ashley Black said in his Monday
determination.
Ten Network was placed into voluntary administration in June,
with administrators last month deciding to sell the company to CBS.
Mr. Gordon and Mr. Murdoch - Executive Chairman of Twenty-First
Century Fox - launched a fresh bid for Ten last Friday after
Australia's Parliament passed laws easing ownership controls in the
media sector.
Australia's traditional media outlets, including The Wall Street
Journal publisher News Corp., have been hard hit in recent years by
falling advertising revenue as audiences embrace digital
platforms.
Parliament last week abolished a 75% audience "reach rule" that
prevented free-to-air television networks like Nine Entertainment
Co., Seven West Media Ltd. and the Ten Network Holdings Ltd. from
snapping up regional affiliates. It also abolished the
two-out-of-three rule that prevented large media companies from
controlling free-to-air TV stations, newspapers and radio stations
in the same market.
Mr. Gordon and Mr. Murdoch had sought a declaration from the
court that KordaMentha's report to creditors on the proposed CBS
tie-up did not provide adequate information about their joint bid
for Ten Network.
They also sought to lower the weighting of CBS's own vote on the
merger, with the U.S. behemoth having been the largest creditor to
Ten before the network went into administration.
Judge Black said the question of "which of any competing
commercial proposals put by interested parties would be most
advantageous" to Ten Group creditors was a matter for creditors and
shareholders. He ruled that CBS would not be restricted in
voting.
-Write to Rob Taylor at rob.taylor@wsj.com
(END) Dow Jones Newswires
September 17, 2017 22:36 ET (02:36 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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