Ten Oz calls share trading halt

Ten Oz calls share trading halt

"Ten's board is considering the position of the company in light of the position being taken by Illyria and Birketu and the range of restructuring and refinancing initiatives it has under way", said Ten Network.

The company told the ASX that "Over the weekend, Ten received correspondence from financial advisers to Illyria Pty Limited and Birketu Pty Limited".

The Ten Network has this morning placed its shares in a trading halt after influential shareholders in the embattled broadcaster could not guarantee its financing raising fears it may be forced into voluntary redundancy.

Network Ten's board of directors will use the next two days to decide whether to appoint an administrator to the free-to-air broadcaster or keep pursuing refinancing options to keep the company afloat.

However Ten shares last traded at an all-time closing low of 16 cents, down more than 90 per cent in the past two years, and administration raises the possibility of a new bidder emerging for the company.

Despite the financial troubles, Ten is running a suite of popular shows at the moment and its television revenue increased 2.1 per cent to $341 million in the first half of the current financial year. It is understood that the pair have provided $151 million (A$200 million) of guarantees.

It now needs to secure alternative funding before then, or face administration.

Ten's credit profile is wading into "stress territory", and it will struggle to get a traditional lender to come to its rescue, according to Raymond Lee, a Sydney-based money manager at Kapstream Capital. Other directors include Debbie Goodin, former trade minister Andrew Robb (who represents Gina Rinehart's 8.2 per cent), Andrew Lancaster, chief executive of Win Corporation and representative for Mr Gordon's 15 per cent, and Foxtel chief executive Peter Tonagh.

Ten's guarantors: Lachlan Murdoch, Bruce Gordon and James Packer.

"The board should not rush prematurely into administration", Ms Fox said.

If Ten were to enter receivership, it would allow the network to dispose of these output deals and could pave the way for its guarantors to launch takeover bids if media reforms are passed that relax ownership laws. Mr Murdoch is hamstrung because his role as co-chairman of publisher News Corp and ownership of Nova radio stations would tip him over the two-out-of-three rule.

"Whilst this is an unsettling time for us all, we must assume that our operations continue as usual", he wrote.

The appointment of administrators could give the broadcaster a chance to get itself out of onerous contracts with U.S. networks CBS and 20th Century Fox.

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