CBS swoops on Ten deal
UPDATE 28/08 - US TV giant CBS has been confirmed as the successful bidder for Network Ten, as its money was not reliant on media law changes. Details are available here.
ORIGINAL 25/08 - The ACCC will not oppose a proposed bid for the Ten Network by current shareholders Bruce Gordon and Lachlan Murdoch.
The competition regulator says the deal would not result in a "substantial" lessening of competition in the media, but the proposed takeover does require changes to media ownership laws.
Mr Gordon’s private company Birketu, and Lachlan Murdoch’s investment vehicle Illyria, have proposed to jointly buy out Ten, taking a 50 per cent share each.
Birketu currently holds close to 15 per cent of Ten's shares, while Illyria owns 7.44 per cent.
The Australian Competition and Consumer Commission (ACCC) says letting the two men completely take control of the network would not substantially lessen competition, despite ACCC chairman Rod Sim acknowledging that it would somewhat reduce “competition via a greater alignment of Mr Murdoch's, Mr Gordon's and Ten's interests”.
The ACCC noted that Mr Gordon's WIN TV and Ten are broadcast separately in regional and metro markets.
The regulator also addressed the issue of Lachlan Murdoch's involvement, given he is also co-chairman of News Corporation and executive chairman of 21st Century Fox, and holds a range of other media interests.
“We considered whether the acquisition would significantly reduce competition, by causing a reduction in the quality and range of news content, or increasing the negotiation power of the combined Ten/Foxtel/News Corporation,” ACCC chairman Rod Sims said in a statement.
“On the issue of the effect on competition in the supply of news services, the ACCC took into consideration competition from news providers on other media platforms and in particular, the other free-to-air networks, given Seven and Nine have a stronger position in the market than Ten.
“The ACCC also considered the effect on competition in the acquisition of sports rights and other types of content.
“The parties will continue to face competition from the remaining free-to-air networks as well as streaming services for the acquisition of content.”
The deal hinges on the Turnbull Government successfully scrapping the long-standing “two out of three” rule and the 75 per cent reach rule; reforms that experts suggest will continue to be a struggle.