Constantin fights effort at takeover

Highlight owns 41.4% stake, to make offer to minority shareholders

BERLIN — A coup by Swiss-based film and video distrib Highlight Communications has left Bernd Eichinger’s Constantin Film in the throes of a hostile takeover and put Germany’s most successful producer-distributor on red alert.

Highlight’s attempt to wrestle control of Constantin from Eichinger is yet another example of the upheaval created by the fall of Teutonic media mogul Leo Kirch, which left a vacuum in the market that has yet to be filled.

Highlight picked up Kirch’s 21% stake in Constantin last year in a $26 million cash-and-stock deal, later increasing its share to 25% from stock market buys.

Highlight, which recently released “The Hours,” has said it wants to be the number one player in the German-speaking independent film biz.

Last month it purchased another 16.4% from TV license trader EM.TV for $8.2 million plus a loan in the low millions — money EM.TV plans to use for the purchase of another Kirch asset (sports web DSF).

Now holding a 41.4% stake, Highlight is set to make an offer to Constantin’s minority shareholders for the rest of the company.

Move could leave Highlight with up to 75% of Constantin if Eichinger holds on to his own 25.1% stake.

Constantin’s management immediately declared it would fight Highlight’s hostile takeover and began to review possible defensive measures, which could include mounting a counter offer to minority shareholders, or, exiting the company altogether.

Eichinger would have little trouble setting up shop on his own.

Highlight would be ill-advised to lose the uber-producer, who has successfully steered the company through rough waters and continued to boost its credentials with a recent string of critical and commercial hits, including the Oscar-winning “Nowhere in Africa,” “Resident Evil” and “Manitou’s Shoe.”

Eichinger’s loss would be a severe blow to Highlight’s lofty: Constantin released eight of the top 10 domestic grossers of 2002, and in the past two decades, Constantin films have accounted for 50% of all domestic tickets sold at the local box office.

After 25 years at the helm, however, Eichinger is more likely to seek a peaceful solution than to abandon ship.

Constantin execs were caught off guard by Highlight’s sudden acquisition of EM.TV’s stake but have since opted for a more diplomatic approach.

Constantin’s supervisory board met last week (April 29) to draw up a defense plan but in the end chose to continue quiet negotiation with Highlight.

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