SYDNEY • CBS, the United States' most-watched TV network, yesterday said it plans to buy its biggest customer in Australia, Ten Network Holdings, and launch its streaming service in the country.
Through the deal, Ten's biggest creditor has thwarted a takeover by a consortium led by Mr Lachlan Murdoch - co-chair of CBS rival and fellow Ten creditor News Corp - that was widely expected after Ten entered administration in June.
"We have been able to acquire it at a valuation that gives us confidence we will grow this asset by applying our programming expertise in a market with which we are already familiar," CBS chairman and chief executive Leslie Moonves said in a statement.
CBS is wading into an Australian market where broadcasters, and Ten in particular, are cutting costs as losses deepen, with advertisers following viewers to streaming services such as Netflix and Amazon's Amazon Prime.
The deal with Australia's least- watched commercial network also buys CBS a foothold in the local online viewing market via Ten's digital outlet Tenplay, as it seeks to capitalise on overseas sales of its proprietary shows.
"I certainly would welcome the Ten Network coming into a period of stable ownership and financially stable circumstances," said Australian Prime Minister Malcolm Turnbull.
Neither party disclosed details of the deal, but analysts and local media valued Ten at A$200 million (S$215 million) to A$250 million. Its shares had a market value of A$58 million before trading was suspended when the firm entered administration.
CBS has been benefiting from a gamble to own more of the shows it broadcasts rather than licensing them from studios.
Filings from administrator KordaMentha, lodged after creditors, including Mr Murdoch, pulled a debt guarantee, showed CBS last month claimed A$844 million owed for licensing shows such as NCIS and CSI: Crime Scene Investigation.
"It's already a huge relationship. All the major dramas on Ten are supplied by CBS," said media analyst Peter Cox. But their popularity in Australia has waned, he said.
"The test will be whether an American network can relate to an Australian audience and deliver Australian programmes that Australians want to watch."