You will be redirected back to your article in seconds

Springer court ruling stops Kirch from selling stake

Sale deadline set for Sept. 10

BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval.

The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO Dieter Hahn. The two are rumored to be eyeing the sports rights division of the insolvent Kirch Media.

Kirch is said to be asking nearly $1 billion for the Springer stake. But he only has until Sept. 10 to complete a sale or it goes to Deutsche Bank, which is holding it against a $720 million loan.

According to Springer, the injunction forces Kirch to respect a “restricted transferability” clause attached to the sale of the shares, adding that they cannot be traded without Springer’s approval. Specifically, the injunction was targeted at efforts by Kirch to get around the clause.

Known for his legal prowess, Kirch is looking to sell his company Print Beteiligung, which contains the Springer stake, and not the Springer shares themselves.

Kirch is expected to take legal action of his own to reverse the court ruling. Sources close to the Munich mogul are confident that Springer’s move will have little chance of stopping the sale, adding that the publisher will be vulnerable to legal action if it postpones a deal.

Although Kirch was close to selling the stake to German publishing group WAZ, the injunction gives the conservative Springer more time to negotiate with Swiss publisher Ringier, which it prefers over the ideologically opposed WAZ.

Indeed, leading Springer newspapers Bild and Die Welt have led an aggressive campaign against WAZ, comparing its expansion course to that of Italian Prime Minister Silvio Berlusconi, who controls nearly 90% of that country’s airwaves.

Last week Springer even warned shareholders of a possible hostile takeover by Rupert Murdoch’s News Corp. or WAZ and asked them to block such a move. News Corp. has categorically denied that it wants the Springer stake.

“In the end the price will likely be the deciding factor,” says a source close to Kirch. Ringier looks set to best WAZ’s reported offer of $956 million for the stake.

Meanwhile, Kirch Media, which has been under the control of its lenders since it filed for bankruptcy in April, is threatening legal action against Dresdner Bank to keep it from selling its 25% stake in Spanish TV web Telecinco, which the bank holds in lieu of a $450 million loan to its former parent company Kirch Group (also known as Taurus Holding).

Kirch Media argues that Taurus Holding had no legal right to use a Kirch Media subsidiary as collateral for a loan. Munich’s district attorney is investigating the case. The 25% stake in Telecinco, one of Europe’s most profitable TV channels, is valued at around $486 million.

Telecinco’s other shareholders, Italy’s Mediaset, Dutch company ICE Finance and Spanish publisher Correo, were originally expected to jointly buy the stake, with Mediaset looking to increase its current 40% to 49%. At the moment, however, there appear to be no interested buyers.

As for the sale of Kirch Media itself, a final deal is not expected before mid-September. Three consortia are bidding for the remains of the free TV and film rights giant, including Columbia TriStar and Germany’s Commerzbank; producer Haim Saban and French TV group TF1; and former Kirch Media shareholders Lehman Brothers, Saudi Prince Al Waleed bin Talal and German retail giant Rewe.

Kirch Media creditors are said to be considering selling its lucrative 52.5% stake in ProSiebenSat 1, Germany’s biggest terrestrial broadcaster. The move could speed up the process as Kirch Media bidders are mostly interested in ProSiebenSat 1’s four free TV channels, which air hit U.S. shows like “Buffy the Vampire Slayer” and “Sex and the City.”

More Biz

  • China's Wanda Hits Back at Allegations

    China's Wanda Ready to Sue Over Financial Allegations

    BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval. The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO […]

  • Disney-Fox Deal Casts Future of Fox

    Disney-Fox Deal Casts Future of Fox Studio Lot Into Doubt

    BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval. The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO […]

  • Morgan Spurlock Sexual Misconduct

    Morgan Spurlock Steps Down From Production Company After Admitting to Sexual Misconduct

    BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval. The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO […]

  • Consumer Watchdog Group Warns Against Disney-Fox

    Consumer Watchdog, Anti-Trust Experts Warn of Higher Prices From Disney-Fox Merger

    BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval. The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO […]

  • Verve

    Verve Continues to Show Dominance in Spec Market Following Blacklist, Hitlist Unveilings

    BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval. The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO […]

  • Sony's Tony Vinciquerra: Disney-Fox 'Creates Opportunities'

    Sony's Tony Vinciquerra: Disney-Fox 'Creates Opportunities'

    BERLIN — Bankrupt Bavarian media baron Leo Kirch suffered a setback last week as publishing group Axel Springer won a court injunction blocking him from selling a 40% stake in Springer without the publisher’s approval. The court ruling could complicate comeback plans reportedly being cooked up by Kirch and his former Kirch Group deputy CEO […]

More From Our Brands

Access exclusive content