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SYDNEY - Canadian media group CanWest Global Communications has failed to sell its stake in Australian broadcaster Ten Network, reports say, days after CanWest completed its sale of TV3 owner MediaWorks.
Shares in Ten were placed on a trading halt yesterday following an article in the Australian Financial Review that CanWest was expected to retain its 56.4 per cent stake in Ten after failing to find a buyer. CanWest launched the sale process in January.
"Ten Holdings has not been advised by CanWest at this time in relation to its position regarding the sale process," Ten, which is Australia's third-largest TV station, said.
CanWest had initially hoped to get up to A$2 billion ($2.23 billion) for the holding, but the sale has made slow progress, according to media reports and sources familiar with the matter.
The Australian Financial Review newspaper said interested bidders had dwindled down to private equity firms Carlyle Group and Blackstone Group, but talks with those firms broke down earlier this month.
A Ten spokeswoman declined to comment further.
CanWest last week settled its transaction to sell its 70 per cent stake in MediaWorks New Zealand- which owns TV3, C4 and half the country's radio stations - to private equity firm Ironbridge Capital.
Analysts have said Ten's high valuation put some bidders off.
Ten has an enterprise value/earnings before interest, tax, depreciation and amortisation (ev/ebitda) valuation of 14 to 15, say analysts. This compares to valuations of 10.3 and 12.5 on rival broadcasters Publishing & Broadcasting and Seven Network when they tipped their media assets into private equity joint ventures.
Ten said on December 7 that CanWest had agreed that if its stake was sold the buyer would make the same offer for the remaining 43 per cent of the company. CanWest is under no obligation to sell its stake.
Ten shares are on a trading halt until tomorrow or until a response from CanWest can clarify its position, Ten said.
- REUTERS
