Lauder to stop funding Channel 10

Ron Lauder has announced that he will stop injecting capital into the television station in 2014 if it is not allowed to apply for a license.

Ron Lauder, Channel 10's main shareholder, has announced that he will stop injecting capital into the television station in 2014 if it is not allowed to apply for a license. This is because of disagreements between Lauder and Channel 10's controlling shareholder Yosef Maiman on one hand and Arnon Milchan on the other. They are concerned that Milchan, a shareholder in the company, will not sign the application for a license.

In October, sources informed ''Globes'' that Lauder had injected an additional NIS 10 million into Channel 10, on top of the NIS 7 million he injected in September. He had previously injected NIS 120 million into the station since January, NIS 40 million more than he promised when the station's franchise was extended.

On Sunday, "Globes" reported that Channel 10's board of directors will approve a NIS 5 million cut in the budget of the news company to NIS 85 million. The labor contract signed with Channel 10's employees in 2012 does not allow for a pay cut, and there are reportedly no plans to fire employees or axe programs at this time. However, there will be no hiring, and teams will reportedly be reduced.

Channel 10's budget for 2014 will be NIS 310 million - NIS 40 million more than in 2012. The board, chaired by Maiman, has approved the budget, after rejecting management's request for a NIS 370 million budget. This means that planned programs will be frozen, but several current programs, including expensive reality shows have already gone into production.

According to shareholders' representatives, talks between Lauder and Milchan have made no progress. Milchan wants to quit Channel 10, but except for unofficial conversations that "Globes" reported last week, there are no contacts between the parties. The concern is that Milchan will not sign the license application, which must be submitted by the end of the year, or else the station will be in financial trouble. Not signing the license application could cause the station's other shareholders, especially Maiman, financial difficulties. Maiman gave a NIS 30 million guarantee to the Origo debt recycling fund and a NIS 20 million guarantee to the state.

The parties declined to comment on the report.

Published by Globes [online], Israel business news - www.globes-online.com - on November 11, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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