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Germany signs off on Kirch/Premiere

Gov't OKs merger

BERLIN — The German antitrust commission has given the Kirch Group the greenlight for a majority takeover of pay TV broadcaster Premiere.

While the $860 million deal was finalized last month between Kirch and CLT/Ufa, which sold its 45% stake to Kirch, the government regulator still had to rubber-stamp it. The office expressed support for the takeover last month, and a blocking of the deal had not been expected.

Bertelsmann bounced

The move leaves Kirch with 95% of Premiere and in total control of Germany’s pay TV market. A market run by both Kirch and German media giant Bertelsmann, which holds a big stake in CLT/Ufa, would have been totally unacceptable, said a commission spokesperson, adding that the panel would have done everything possible to stop Kirch and Bertelsmann from taking over Germany’s pay TV market.

Dieter Wolf, head of the antitrust commission, told a news conference Wednesday that although the pay TV market would now be exclusively in the hands of Kirch, rivals still have a chance to break the group’s dominance. “Our task was to ensure that this new market remains open for new competitors to enter it. I think we have achieved that.”

France’s Canal Plus and Rupert Murdoch’s News Corp. have indicated their interest in launching ventures in Germany, Wolf pointed out, and they eventually might provide competition to the Munich-based Kirch.

Venture resistance

Wolf added that his office would continue to keep Kirch and Bertelsmann from forming any joint ventures in the future.

Kirch announced last month that it would merge Premiere with its digital pay TV service DF1. The new entity will carry a new name, yet to be announced.

CLT/Ufa agreed to sell out to Kirch after the European Commission torpedoed merger plans between Premiere and DF1 last year.

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