By Tom Westbrook
SYDNEY (Reuters) - Media scion Lachlan Murdoch made a revised offer for Ten Network Holdings Ltd (AX:TEN) on Friday, a day after Australia's senate voted to lift a ban on the ownership of multiple types of media assets, allowing him to challenge U.S. suitor CBS Corp (N:CBS).
The offer, whose value was not disclosed, escalates the battle for the bankrupt broadcaster into a full-scale bidding war, with Ten having already agreed to a surprise buyout by CBS.
Ten went into administration three months ago after a long-term decline in viewer numbers and advertising revenue. But its national reach and strong brand recognition in the world's 12th-largest economy makes it an attractive buyout target.
Murdoch and business partner Bruce Gordon bid for Ten as deregulation of media ownership was moving through parliament. But with the ban still in place, CBS - Ten's biggest creditor - stepped in, prompting a legal challenge from Gordon.
Murdoch, co-chair of News Corp (O:NWSA) - publisher of about two-thirds of Australian newspapers - and Gordon, owner of a regional TV station, are now able to counter CBS, as the pre-internet age regulation intended to prevent consolidation is certain to be overturned in a parliamentary vote next month.
"Those rules are about to disappear and they're looking to cash in," Margaret Simons, an associate professor of media at Monash University in Melbourne, said of the new bid by phone.
"Every time the media ownership regulations have changed over the last 20 years there have been almost instant moves by the big players, and all the big players have been pushing and watching and waiting for this for a long time," she said.
CREDITOR PAYOUT
Ten is CBS' biggest Australian customer. Its administrator, KordaMentha, has entered binding transaction documents with CBS, which showed the U.S. firm has agreed to pay at least A$201.1 million ($160.84 million) in cash. CBS has signed and the deal is now pending creditor approval, a KordaMentha spokesman said.
KordaMentha published a report to creditors on Monday which showed CBS offered a pool of A$32 million in payouts to unsecured creditors, structured such that KordaMentha said the deal was "superior ... for creditors generally".
The revised bid from Murdoch's private company Illyria and Gordon's Birketu raises its proposed cash payable to unsecured creditors to A$55 million from A$35 million, showed documents reviewed by Reuters on Friday. Some large creditors would still receive less than under CBS' bid, the bid documents showed.
The spokesman for KordaMentha had no comment on the revised bid. CBS declined to comment.