TEN shareholders considering class action following CBS deal

Not everybody is happy about the CBS takeover of TEN.

Shareholders who stand to lose everything are considering a class action lawsuit.

Australian Shareholders Association director Allan Goldin told News Corp preliminary talks have been held with law firms about a class action.

“Class actions are very difficult and whether that is a possibility or if it’s not it’s really too early to say. But sure, we are having talks,” he said.

The surprise announcement on Monday will see secured creditors paid, along with a guarantors’ fee owed to billionaire shareholders Lachlan Murdoch, Bruce Gordon and James Packer. But smaller shareholders are expected to receive no compensation for their shares being taken over by the $35 billion ($US28 billion) broadcaster.

Shareholder John Homewood told Fairfax, “It just seems to me that these administrators … it is as if the poor old shareholder has been pushed out of the way of a business that for all intents and purposes was viable.

“I have come to the realisation that effectively shareholders will have their equity interest just transferred over to CBS. It is really the lack of information being provided that has got me a bit hot under the collar.”

ASA has written to Treasurer Scott Morrison, asking that CBS amend its offer so that shareholders did not miss out.

“It is just like anything, you’d prefer Australian assets to stay in Australian hands if possible,” Goldin said, adding that “outdated” media laws made it “almost impossible” for an Australian to bid.

The CBS deal is yet to be voted on by creditors and passed by the Foreign Investment Review Board. Shareholders will not get a vote on the CBS takeover and have not been able to trade shares since June 13.

4 Comments:

  1. Welcome to investing in shares?

    If you put your last $5,000 into shares in Ten then I’m sorry but the phrase “don’t put all your eggs in one basket” comes to mind. Diversification is the key and even with that small nest egg you can spread your risk across a range of different industries and investments especially these days with many more options than there used to be for small investors.

    Shareholders are always non guaranteed creditors, unless you happen to have a large stake in the company and have negotiated with the board at some point to protect yourself, as is the case here. That’s just life.

    I empathise with the small shareholders, but I don’t think they will get anywhere without extraordinary government intervention and even then you have to question why the government should get involved at all. There are plenty of small shareholders who have lost money in many…

  2. Not sure what they are going to lose exactly….16C a share….At their best they were only around $1.40…you would have to own an awful lot…and lawyers….big… $$$$…..also jumping the gun…I suspect CBS..at those prices…would cover them…..under good will…..or at least a happy offer….drop in the ocean for them…
    As for Australian ownership…depends on the Australian, to my way of thinking……

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