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SA will become "Soviet state" if Xenophon media deal goes through: Labor

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Nick Xenophon says he’s seen “no suggestion” a proposed takeover bid of Network Ten by media magnates Lachlan Murdoch and Bruce Gordon would see its South Australian newsroom shut down, as Labor today claimed Adelaide would become a "one media voice town" if the SA senator gets his way.

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Xenophon and his fellow NXT crossbenchers are poised on the edge of a breakthrough on the Federal Government’s media reform bill, this morning claiming a deal, featuring his compromise three-year government assistance fund for small and regional publishers, was all but done.

The political horse-trading is set against a backdrop of uncertainty for the Ten Network, with media mogul Gordon challenging the sale of the station to US giant CBS.

Gordon’s Birketu and Murdoch’s Illyria Nominees Television had secured regulatory approval to make a joint bid for the free-to-air network, but administrator KordaMentha instead recommended a rival offer from CBS, prompting Ten’s regional affiliate WIN – which is majority-owned by Gordon – to make an urgent application to the NSW Supreme Court.

Documents tendered in court yesterday by KordaMentha suggested the joint bid included a provision “for the repudiation of leases relating to Pyrmont, Melbourne and Adelaide”, which the administrator saw as “operationally [a] moderate to high risk”.

A creditors meeting originally scheduled for yesterday has been deferred until next week while the matter is heard.

Justice Ashley Black reportedly this morning dismissed a move for Birketu/Illyria’s proposal to be put to Ten creditors at the meeting.

But the Gordon/Murdoch takeover cannot proceed without changes to Australia’s media ownership laws, prompting SA Labor backbencher Nick Champion to argue repealing rules limiting a single proprietor from owning radio, television and print assets in one licensed market will devastate Adelaide and create a “one media voice town”.

“I mean we will sort of have a Soviet or dictatorship system where there will simply be one media outlet, it will be something like Pravda,” he told reporters today.

“(Adelaide) essentially will go from not just being a one-paper town, but being a one media voice town.”

Champion said he doubts additional money for cadet journalists, secured by Xenophon, will help if newsrooms are forced to close.

South Australian Greens senator Sarah Hanson-Young also heaped political pressure on Xenophon, arguing “the revelation that Lachlan Murdoch and Bruce Gordon plan to close Ten studios in Adelaide and Melbourne is a direct attack on local journalism and media diversity”.

“Forcing through media reform on a timeline convenient to Murdoch and Gordon would ultimately result in less diversity in the media in a city like Adelaide that needs more,” she said in a statement.

“The arguments from the Government to pass media reforms in order to save jobs fails in the face of these revelations and are a kick in the guts to hard-working journalists and production staff in my hometown of Adelaide, and in Melbourne.”

But Xenophon told InDaily today “having a obtained information from both [bidders] there’s no suggestion the [Adelaide] newsroom will shut down”.

“The only suggestion is that the newsroom will be relocated to a different building,” he said.

He said he “strongly supports” retaining a local Adelaide Ten news service and believed that under the Gordon/Murdoch bid “there would still be a local Adelaide newsroom employed in local premises”.

“But of course I’ll make further inquiries in relation to that,” he added.

“I’m obviously concerned about it but the information I have is there’s no plans to shut down the Adelaide newsroom.”

SA Liberal frontbencher Simon Birmingham told ABC Radio Adelaide today his Government’s proposed reforms “will make it more viable for free to air broadcasters to continue to operate” but “I don’t think that it’s for government to micromanage every media outlet or entity”.

“What we do want to do is make sure that we’ve got a framework that sustains a strong media industry in Australia [and] you can’t continue to levy the same rules and conditions and charges and fees upon them as you have in the past,” he said.

Dr Andrew Bell, SC, representing Gordon, told the NSW Supreme Court today that the CBS bid included “unexplained and inexplicable discriminatory treatment” carrying a high potential for litigation, and claimed Ten’s administrators failed to tell creditors that the US bid did not treat all of them equally, and was therefore likely to be challenged.

“Why would creditors give a tick to something that’s going to get attacked when two reputable people put forward an offer with comparatively less risk?” Bell said.

KordaMentha senior partner Mark Korda said in a statement on Monday that it was “disappointing that Birketu – either directly or via related parties – have pursued court action, delaying the creditors’ vote and putting at risk the certainty provided to 750 employees and creditors under the CBS transaction”.

He reiterated that the CBS deal represented the best outcome for creditors and for Ten.

“Both the administrators and the receivers, having regard to their respective obligations, concluded that the CBS proposal was superior to the Birketu and Illyria proposal for creditors generally,” he said.

The hearing continues.

– with AAP

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