Channel Ten shares raid marks Packer’s return to media investments
It was billionaire gambling operator James Packer who caused the tremor movements of Channel Ten market shares as confirmation was made on Wednesday that Mr Packer paid a whopping $245 million to secure a 15 percent stake on the company through his private firm Consolidate Press Holdings.
Analysts said that the stock raid on Channel Ten came as a surprise, especially coming from a man who divested his Channel Nine shares two years ago. But the decision to re-invest in a TV company was not a shock either as experts said that Mr Packer's return on the television industry signalled renewed interest to exploit profit potentials.
The gaming mogul has been focused lately on the gambling industry but analysts said that the resurging television industry may have enticed Mr Packer amidst the turnaround that the sector has been experiencing with free televisions chalking up better advertising revenues and declines by digital channels already averted.
Channel Ten would be publishing its financial results on Thursday and analysts are anticipating that more information on the share raid would be revealed, coming from a man whose family was previously enriched by media investments.
Media analyst Peter Cox told ABC that the timing is just ripe for Mr Packer's return to the industry and he could only surmise that it is the rich promises of advertising that lured back the wealthy investor, at a time when Channel Ten is faced with rough sailings in the market.
Mr Cox said that the advertising industry has been recovering for the past six months while the television industry saw improvements of up to 15 percent in the same period and with Channel Ten clearly struggling, Mr Packer "would be looking at it as an opportunity to buy back into a network and turn it around again."
He added that the 15 percent stake that Mr Packer now holds on Channel Ten would logically graduate to a level of 50 percent in the near future as the gaming billionaire seeks to own more shares, control the company and infuse his style in running the television station.
Analysts agreed that Mr Packer's move on Channel Ten merely represented deliberate efforts to regain foothold on a sector that saw up to four generations of the family actively investing and partaking from the hefty profits delivered by the industry.
Recent moves by Mr Packer to raise his interest on Consolidated Media Holdings from 47.92 percent to 49.67 percent pointed to that purpose, according to analysts, though for now the stocks he captured on Channel Ten were still insufficient to allow for a formal takeover bid as investors must take up at least 19.9 percent to initiate an acquisition proceeding.
As of 1230 AEDT on Wednesday, Channel Ten shares were trading up at $1.50, coming from its closing level of $1.41 on Tuesday.