Berlusconi takes Premiere stake

News pushes stock price up 37%

BERLIN — The share price of News Corp.-controlled Premiere, Germany’s biggest paybox, soared 37% in volatile trading on the Frankfurt Stock Exchange Monday after Italian Prime Minister Silvio Berlusconi’s Fininvest stunned the market by acquiring a 3.134% stake in the company.

Premiere’s share price added Euros 1.03 ($1.30) to reach Euros 3.86 ($4.86) by late Monday, after hitting an earlier peak of Euros 3.97 ($5).

Premiere’s share price had halved to Euros 4.60 ($5.79) in early October after the company issued a profit warning, and admitted it had nearly 1 million fewer subscribers than that shown on its books.

The share price surged on Monday after Berlusconi’s investment was revealed, although the latest acquisition had been made on Nov. 14, according to Premiere.

Dealers said the acquisition was interpreted as a vote of confidence in the company, which has struggled with losses in the last four quarters.

“The share price has been hit so hard for so long that everyone was happy to have some news like this to get back in,” said one trader.

“There’s been takeover speculation regarding Premiere for quite some time and this is something new to think about,” said another dealer.

News Corp. is the paybox’s single largest shareholder, having upped its stake to 25% since the beginning of the year. Its share price has fallen nearly 80% this year.

In September, James Murdoch, News Corp. chairman and CEO for Europe and Asia, tightened his control of Premiere, replacing topper Michael Boernicke, who ankled suddenly, with Williams, who had been News Corp. finance chief for Europe and Asia.

Nearly 38.5% of the paybox is publicly traded, with the remainder owned by several private equity firms and Premiere execs.

Premiere’s share price has seen volatile swings in the past — such as when it lost the rights to broadcast the Bundesliga, the top German soccer league.

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