AMSTERDAM The Veronica Assn., which owns a 35% stake in the Netherlands’ largest commercial network, Holland Media Group, is threatening to bail out of its nearly five-year working agreement with Luxembourg-based TV giant CLT/Ufa.
CLT/Ufa owns a 65% stake in HMG, the three channel network that houses Veronica, one of Holland’s top branded channels, as well as commercial market leader RTL 4 and sister channel RTL 5.
The Veronica Assn. voted Thursday to support a motion by Veronica chairman Joop van der Reijden to dissolve the 1995 pact with CLT/Ufa that made Veronica part of the three channel net.
Prior to 1995, the year it went commercial, Veronica was the wealthiest and most successful of the Dutch public broadcasters.
HMG spokeswoman Jacqueline Hekkers told Daily Variety that the merger agreement gave HMG the rights to all of the programming, and distribution contracts with cable companies. “We can’t figure out how they could possibly benefit” if the agreement is dissolved, she said.
“If the Veronica Assn. attempts to launch another channel or to merge with another media group, they will be doing so empty handed,” said Henk Slotboom, a media analyst with the Dutch-based office of Swiss investment bank Julius Barr. He called the move a ploy on the part of Veronica shareholders to gain more power on the HMG board of directors. Veronica currently has one board representative to CLT/Ufa’s three.
Veronica is more than 30 years old, and its brand name carries plenty of punch in this territory, but HMG several years ago patented the name Veronica — The Young One, giving it the right to use the brand name Veronica even if the pact is dissolved.
Veronica’s move is the latest in a series of troubles to plague HMG, including the resignation of former chairman Pieter Porsius several months ago.
An ongoing power struggle between Veronica shareholders and CLT/Ufa was stepped up several years ago when giant Dutch giant media company VNU sold its shares to CLT/Ufa, giving the latter a 65% slice of the company and leaving Veronica with little decision-making power.
Neither CLT/Ufa nor Van der Reijden could be reached for comment.