Australia's Network Ten sets sights on TV3, TV4

Australia's Network Ten is considering taking over TV3 and TV4.

"We are having discussions on a whole range of issues - ownership is one of them," said Brent Impey, the New Zealand chairman of CanWest, which owns both channels.

While Ten executives had been here to look at the channels, it was going too far to say that the Australian network was carrying out due diligence, he said.

"Whether they make an offer remains to be seen."

He said that ownership by Network Ten would be recognition that Australia and New Zealand were coming closer together.

"One obvious one is the Universal Studio deal where we [TV3 and Ten] joined together for the acquisition of films and TV series. That is something that is more practical to do with an Australian network."

He said CanWest's New Zealand radio operations, which include the More FM and RadioWorks networks, would not be affected.

CanWest Global Communications, one of Canada's largest media groups, owns a 57.5 per cent "economic" stake and a 14.9 per cent voting stake in Ten.

The economic holding is due to Australian laws restricting foreign ownership of broadcasters.

Local television staff have been briefed about the possibility of a takeover. Most staff were believed to view the prospect positively because of Australia's closer cultural links to New Zealanders than Canadians.

The Canadian owners have not been happy with TV3's financial performance.

Last year, TV3 had a $19.9 million pre-tax loss, although much of that was due to foreign exchange losses and a $20 million writedown of old programming stock.

TV3's profits in the November quarter fell as the New Zealand dollar weakened and viewers deserted the channel to watch the Olympics on TV One.

TV3 and TV4's net profit for the quarter was down $C345,000 ($520,930) from $C4.7 million in the previous year's quarter.

CanWest said its New Zealand operation had been hit by an 18 per cent fall in the value of the kiwi.

TV3 and TV4's combined revenue for the quarter fell from $C22.6 million to $C16.9 million.

- NZPA