The changes continue at the embattled Ten Network as the shares in regional Pay TV group, Austar jumped sharply on takeover speculation yesterday.
Were they all linked, somehow?
Austar shares jumped 10.6% or 12c to $1.25 at the close, after rising 33c to a day’s high of $1.46 on the talk that Telstra has cleared a move on the company by Foxtel.
Ten shares though retreated 1.1% or 1.5c to $1.31.
James Packer quit as a director immediately, the Ten board has raided the Seven Network for its CEO in the shape of Seven’s sales boss, James Warburton and the long time chief financial officer of the company, John Kelly, is going.
Warburton will replace acting CEO, Lachlan Murdoch who was asked to fill the role by the company’s board after it removed Grant Blackley as CEO late last month.
Media reports said Murdoch ‘brought’ Warburton to Ten
Ten CEO, Grant Blackley was flicked 10 days ago and late last year then chairman, Nick Falloon was marched by the new look board, which included James Packer and Lachlan Murdoch.
Now Murdoch, CEO until Warburton arrives in July, remains on the board.
There was no explanation for the Packer departure. But questions being asked include whether the board overruled objections he may have had to the appointment of Mr Warburton.
The announcement simply read :
"Ten Network Holdings Limited today announced the resignation of James Packer as a director of the Company, effective immediately." That was it.
Other speculation included the fact that there might be a move on Austar by Foxtel.
Mr Packer controls Cons Media (with Kerry Stokes, the owner of the Seven Network) which owns 25% of Foxtel (but then Mr Murdoch is on the News Corp board which ultimately controls 25% of Foxtel as well).
Mr Packer’s resignation coincided with the announcement that James Warburton had been poached from Seven to be the new CEO.
Warburton has been a frustrated CEO in the wings at Seven, but has been unable to find a way of moving past David Leckie, Seven’s successful CEO, who used to be CEO of the Nine Network.
Leckie was named CEO of the about to be created Seven West Media (to be created by the sale of Seven Media Group to West Australian newspapers in a deal orchestrated by Kerry Stokes).
Seven’s David Leckie said the company was sorry to see Mr Warburton go and wished him well.
Warburton had the sales chief gig as well as head of digital, but there have been reports that he wanted the CEO’s role.
A story late last year in the Sydney Daily Telegraph claimed that Mr Leckie may be replaced by Mr Warburton.
Ten said Mr Warburton will commence as Chief Executive Officer on 14 July, 2011 and it is intended that Mr Warburton will also join the Ten Holdings Board.
Mr Warburton comes from the sales side of business (as did Mr Blackley and Mr Leckie).
The statement that "Ten Holdings today also announced that Group Chief Financial Officer, John Kelly, would be leaving the Company on 18 March 2011. Paul Anderson, currently Chief Financial Officer – Television, has been appointed Chief Financial Officer of the Company effective 21 March 2011.
That sort of completes the clean out at the top of the company. Still left from the old management group are the head of Sport, David White, the head of News, Jim Carroll and the most important man in the business, chief programmer, David Mott.
A report in the Australian Financial Review sparked the surge in Austar shares.
It reported that Foxtel’s main shareholders, including media group News Corp and Telstra, have agreed in principle to back a $2 billion bid for Austar.
In a statement to the stock exchange this morning, Austar said it "has received no proposal of this kind. Austar understands that verbal discussions have taken place between Foxtel and (Austar’s main shareholder) Liberty in relation to a possible acquisition of Austar," the Austar statement said.
"No assurance can be given that those discussions will lead to a proposal being put to Austar or its shareholders.”
Austar said it would ”update shareholders at the appropriate stage should a formal proposal eventuate.”
Austar’s largest shareholder is US-based Liberty Global, which is controlled by John Malone. He killed an earlier attempt by Foxtel to buy Austar by demanding around $2 a share. Foxtel wanted to offer around $1.185m, according to media conjecture.
He will have to say yes to a lower price than $2 a share, even though Austar’s profits and subscriber numbers are higher than they were in 2007-08 when the last talks happened.
