THE last of Ten Network's billionaire investors has backed the struggling broadcaster's second capital raising in six months.
Mining billionaire Gina Rinehart decided to participate fully in the institutional component of the $230 million capital raising before the 5pm deadline on Friday. This ensures she will maintain her 10 per cent stake in the media company.
Shares that were not picked up by institutional shareholders were to be redistributed for sale on Friday, but the word from institutions was that no big blocks of shares were available - a signal that Mrs Rinehart had taken her entitlement.
Investors are paying 20? a share and are entitled to four new shares for every five they own. The stock traded above $1.50 in November 2010.
The decision answers questions, for now, about whether Mrs Rinehart still has an appetite for media stocks after making big losses on her investments in Ten and Fairfax Media, owner of The Age.
After the shareholders' meeting on Thursday, Mrs Rinehart was blunt about Ten's shortcomings.
"I think that we have to be more prompt on where we could cut costs. Over the last two years, I think we could have done more there," she said. "Obviously we're not doing well enough yet with our programming, so these are things that I hope we'll see improvements on. I think we're right to be heading to that particular age category [18-49] as our main demographic, because they do a lot of the advertising."
Ten chairman Lachlan Murdoch said on Thursday that the network's other billionaire shareholders - James Packer, Bruce Gordon and himself - would participate in the raising, which he described as "prudent" given the deteriorating outlook for media.
"Poor execution of our spring programming schedule, compounded by a weak advertising market, has negatively impacted our results," Mr Murdoch said at the meeting.
He failed to offer any words of support for the man who replaced him as chief executive less than a year ago, James Warburton.
Analysts said that the latest capital raising - which is on top of a $200 million raising in July, and the sale of the company's outdoor advertising business in October for about $100 million - tackled concerns about its balance sheet but not operational issues.
JPMorgan is now forecasting an 18 per cent revenue decline for Ten in this half-year "given the poor ratings start to the year, in a weak TV advertising market".
Ten has even lost share in the 18-49-year-old audience that it is targeting, according to Deutsche Bank, which says the company generated no operational cash flow in the first quarter and that cash flow may look worse in the second quarter due to annual licence fees and programming costs.