An Australian commercial television network has fallen into administration days during the end of the 2016-2017after their billionaire shareholders pulled the plug. Read more to know the complete story.
About the Network TEN
Network 10, also known as Channel 10, is one of the popular Australian commercial television networks. It is a free-to-air network, which is broadcasted in the state capital cities of Melbourne, Sydney, Adelaide, Brisbane and Perth. The network has been extended to regional areas of the Country to make it a national television network. The channel is owned and operated by Ten Network Holdings, a subsidiary of CBS Studios International.
The Launch Story
It was first launched as ATV-0 in Melbourne on 1st August 1964. The owner of the network was Ansett transport and media group, which was one of the most renowned domestic airlines in Australia. Later in 1965, the network launched the new station named as Ten-10 in Sydney and the same year, TVQ-0 launched in Brisbane and SAS-10 in Adelaide.
In the early of 1970, the new name has been adopted to make it more popular all around Australia, especially Melbourne and Sydney. The title was ‘The 0/10 Network, which caused some exceptional innovations in the Australian Television Network. They broadcasted horse races in Pakenham Victoria for the first time.
The Expansion Story
First few years were crucial for the survival of the 0/10 Network. In the starting of 1971, they first aired Young Talent Time, which got huge ratings and ran successfully for 17 years. But the network’s revenue increased from $1 million in 1971 to more than $10 million in 1972 with the broadcast of Australia’s most controversial adult soap opera serial Number 96. The series broke the new grounds and took the channel to the new height of success. Later in 1979, 0/10 first broadcasted The Prisoner, which was the first soap opera. It was a great success. On 20th January 1980, the 0/10 Network become Network Ten and become one of the first national channels in Australia. The network became fully national in the year of 1988 with the launch of NEW-10 in Perth, DDQ-0 in Toowoomba and CTC in Canberra under the banner of the same network.
In 2001, Network Ten aired some of the world-renowned reality shows including the Big Brother Australia house, Australian Idol in 2003 – which boosted the overall revenue of the company.
The Story of New Affiliation and Financial Collapse
With the thought of expansion, the Network ten decided to negotiate a five-year affiliation deal with WIN Television. Soon after the agreement, the WIN became the carrier of Network Ten programming in regional Queensland, Southern NSW, Victoria, South Australia, Western Australia, Northern NSW and the Australian Capital Territory. Both the Ten’s largest shareholder Bruce Gordon and WIN Television owner increased his ownership stake in Ten.
But due to a $232 million loss within six months, billionaire shareholders Bruce Gordon, Lachlan Murdoch and James Packer pulled back their support for $250 million loan that would help keep Network Ten out of receivership. This loan was expected to replace an existing guaranteed investment of $200 million. And soon after this, the company went into voluntary administration.
What happened after the Collapse of Network Ten?
Korda Mentha was the one who has been appointed as a voluntary administrator. He worked closely with the existing employees, management team, content partners and suppliers to investigate the financial and operational activities of the business. During the investigation, Korda Mentha found that Ten has a $200 million debt facility from the Commonwealth back, which is backed by their key shareholders and was expiring on 23rd December 2017. The company had been seeking a $250 million loan to replace that debt facility, but Illyria and Birkett, the investment vehicles of Lachlan Murdoch and Bruce Gordon withdrew their support and declined to renew their guarantees. This was the main reason for the Ten’s collapse, which was recorded by the voluntary administrator.
CBS Ownership: A turning point
On 28th August 2017, the voluntary administrators announced that US media company CBS Corporation, which was one of the largest creditors of Ten had entered into the binding agreement to buy the company for $123 million. It was the CBS who refinanced the Ten’s existing debt payments including guarantor fees to billionaire shareholders and existing loans from the Commonwealth Bank.
After the CBS acquisition, the network became the part of CBS Studios International. They overtook the Ten to assist the company in launching its CBS streaming service in the Australian market, and this is how Ten got a new name, new logo and a new series of programs.
This is how Australia’s largest commercial television network lost everything and how CBS came into the role to purchase the company and get them rid of debt outstanding and existing loans from the Commonwealth Bank. The Network Ten is considered as one of the notable corporate collapses in Australian history and will be remembered by all the businessmen who are in financial trouble.