BERLIN — The Kirch Group finally gathered its family of broadcasters under one roof Tuesday with the announcement that it is merging its two commercial broadcasters, ProSieben and Sat1, into Germany’s biggest broadcasting group, to be called ProSiebenSat1 Media.
Move could save the two networks more than $100 million annually through increased efficiency and tighter cooperation on advertising and programming as well as the elimination of overlapping activities, according to company execs.
Announcement comes in the wake of recent reports that Sat1 shareholder Axel Springer Verlag is considering the sale of its 41% to Kirch, which would make the Munich-based media giant sole owner of the network. The Berlin publisher’s supervisory board reportedly met Tuesday to discuss the possible deal.
For the time being, Sat1 is forming a parallel holding company that will house Kirch and Axel Springer’s common assets, including joint marketing venture Media1.
Kirch Media will control 52.52% of ProSiebenSat1, leaving Axel Springer with an 11.48% stake. The remaining shares are publicly owned.
The media giant currently controls nearly 59% of ProSieben, with fellow shareholder Rewe holding more than 41%. As part of the new setup, the German retailer will trade its ProSieben shares for a 6% stake in KirchMedia.
ProSieben owns channels Pro7, Kabel 1 and 24-hour news outlet N24, which will be producing news programming for the entire channel family.
The ProSieben and Sat1 networks jointly generated around $2 billion in revenues and some $200 million in pre-tax profits last year. In the first half of 2000, they garnered an average 25% market share among total viewers.
Kirch’s TV empire also includes sports weblet DSF as well as Germany’s only pay TV service, Premiere World.