BERLIN — Germany’s biggest broadcasting group, ProSiebenSat 1, will today present to shareholders an alternative to Haim Saban’s failed bid for Kirch Media’s core assets.
The broadcaster will ink a 10-year deal for prime slices of Kirch Media’s vast film stockpile, the largest library in Europe. Kirch Media will be liquidated following the transaction.
Under the deal, approved last week by Kirch Media’s creditor banks, ProSiebenSat 1 will acquire 2,000 titles from the Kirch catalog for its three main channels, ProSieben, Sat 1 and Kabel 1, free of charge. Group will split advertising revenues with Kirch Media, which will be replaced by an interim holding containing the ProSiebenSat 1 shares. The rest of the Kirch library of 18,000 film and TV series will be sold, according to Kirch Media chief exec Hans-Joachim Ziems.
Kirch insolvency administrator Michael Jaffe, who will become chairman of the ProSiebenSat 1 supervisory board today, the company is not looking for investors, dismissing reports that former shareholders like Saudi Prince Al Waleed bin Talal may bid for the assets.
“Under the current market conditions, it’s simply not the right time to sell media assets,” Ziems said. He said that the sales of some Kirch assets, like the sports rights business, had raised enough cash for Kirch Media to maintain its 72% stake in ProSiebenSat 1. Company is set to inject e150 million ($178 million) into the broadcaster, while the banks have guaranteed $178 million if a sale of 97 million new shares fails to bring in sufficient cash.
Ziems also hinted that if the plan is successful, ProSiebenSat 1 could do without a new investor and raise money through capital increases on the stock market. The broadcaster has reduced costs by $440 million since 2001 and will post a full-year profit in 2003 despite first-quarter losses.
Saban had agreed to pay about $1.8 billion for the library and Kirch’s stake in ProSiebenSat 1 before the deal collapsed earlier this month.