A high-stakes game is developing between the Nine Network and its Perth affiliate, STW 9, with Nine apparently threatening to turn off the programming provided to the Perth station if the owner, Sunraysia TV, didn’t pay millions of dollars owning under an affiliation agreement.

The long–running dispute erupted a week before Sunraysia TV shareholders meet in Melbourne this Friday. They are expected to approve the sale of STW 9 to WIN for $163 million. Nine’s owner, PBL Media, is the underbidder for Perth.

In a statement to the ASX late Friday, Sunraysia TV, owners of the operating subsidiary, Swan TV, revealed “a dispute” between Nine and Swan over outstanding affiliation fees of $14.7 million.

Swan had paid a substantial part of that sum on Friday, some “under protest”, to assist in the continuing provision of programming and services by Nine. Swan TV will promptly address all outstanding matters, it said.

Sunraysia’s statement said: “A dispute has developed between Swan TV (the operating subsidiary of Sunraysia TV) and Nine Network Australia (a subsidiary of PBL Media) in respect of various amount now totalling approximately $14.7 million.” The money was for “programming and services” provided by Nine.

Sunraysia said the dispute centres on the Nine’s belief that “all the monies are due immediately”. Sunraysia says it wants the amounts of be “substantiated” by Nine but Swan has made arrangement to pay $10.6 million approximately “of which $2.4 million was paid under protest”.

PBL Media may have lost the battle for the Nine Network affiliate in Perth, STW 9, but it is intent on winning the longer-term war over the millions of dollars in unpaid affiliation fees.

WIN also has an unsettled affiliation agreement with PBL Media and can expect PBL demands to finalise a new deal. WIN is objecting to the higher returns PBL Media and its new owners are demanding: around 44% of its revenue.

Will PBL Media and its new controllers, the CVC Asia buyout group, threaten to turn off the Nine signal to WIN if it cant reach settlement on the affiliation agreement”?

Peter Fray

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