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Foxtel to take 15% stake in Ten network in A$154 million raising
[SYDNEY] Ten Network Holdings Ltd., the broadcaster that said in April it was at risk of going out of business, will sell a 15 percent stake to cable-television company Foxtel as part of a A$154 million (S$161.6 million) capital raising.
Foxtel, joint-owned by News Corp. and Telstra Corp, will pay 15 Australian cents a share for the A$77 million stake, 43 per cent lower than Ten's closing price Friday. Existing shareholders will be allowed to buy shares up to the same value at the same price, Sydney-based Ten said in a regulatory statement Monday.
Ten, whose shareholders include billionaires James Packer, Gina Rinehart and Lachlan Murdoch, has struggled to keep viewers from switching to rivals as its share of advertising revenue slumped to about 20 per cent. It'll spend the money from the raising on reducing debt and allow a Foxtel representative to join its board.
"This proposal will drive value for all of Ten's shareholders," Executive Chairman Hamish McLennan said in the statement. "Ten's ratings and revenue performance has materially improved this year." Ten will also take a 25 per cent stake in Multi Channel Network, an advertising joint venture between Foxtel and News Corp-owned Fox Sports, and get a two-year option to become a 10 percent shareholder in online streaming service Presto, joint- owned by Foxtel and Seven West Media Ltd.