Pay-tv provider Foxtel is buying a 15% stake in the free-to-air broadcaster Ten Network for AUD77 million or USD 59 million. The agreement will also see Ten venturing in Foxtel’s video streaming business.
The stake offload is part of Ten Network’s plans of raising as much as AUD154 million to reduce debt and fund its programming costs. According to the Australian, the FTA broadcaster is selling its shares to raise AUD77 million via renounceable entitlement offer.
“Today’s announcement represents an important milestone for Ten and the conclusion of the strategic review process initiated by the Board last year,” said Hamish McLennan, Ten chairman and chief executive, according to The Australian.
“It positions Ten to drive long-term value for shareholders. The board believes 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,” McLennan added.
The deal is subject to regulatory approval. As per the agreement, Ten will own a quarter share in Multi Channel Network (MCN), which is Foxtel’s advertising arm. The FTA broadcaster will also be given an option of buying a 10% stake in Foxtel’s video streaming service, Presto.
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