BERLIN — The bankrupt Kirch broadcasting empire continues to unravel, with one of the last parts finding new owners April 16.
Teutonic sports goods retailer KarstadtQuelle, Swiss sports goods entrepreneur Hans-Deter Cleven and cash-strapped TV license trader EM.TV have bought sports channel DSF for north of $20 million.
The channel lost money when it was Kirch-owned, but its new toppers hope to lever merchandising and marketing potential to create lucrative synergies and turn a profit in two years. The deal includes Kirch Internet sports platform Sport1.
“As Germany’s top sports channel, DSF has a high merchandising potential,” says Peter Gerard, CEO of KarstadtQuelle New Media. “DSF and Sport1 are outstanding communications platforms that can be successfully expanded. This is a strategically important and economically significant investment.”
Company stands to win from an exclusive deal with international soccer body FIFA for merchandising rights to the 2006 World Cup in Germany. The retailer’s growing TV merchandising business includes stakes in Home Shopping Europe and On Air Reisen, a joint travel venture with German web Tele 5.
KarstadtQuelle initially obtained a 78% stake in the assets, with 22% going to Cleven, which owns sporting goods manufacturer Voelkl.
EM.TV will acquire 39% from KarstadtQuelle following federal antitrust approval of the deal. EM.TV already owns stakes in German webs RTL 2 and Tele 5 through its 45% share in Tele Munchen.
The sale is subject to approval by Bavarian state media regulators and Kirch Media’s insolvency administrator and creditors.
EM.TV topper Werner Klatten said sports merchandising would become the company’s second core business alongside tyke programming.
Although EM.TV posted huge losses last year, company has been restructuring and is looking to sell Muppet producer Jim Henson Co. for a sum between $70 million and $100 million. Nearly $30 million is slated to pay back bank loans due by the end of April.
The sale of DSF follows last week’s management buyout of Kirch Media production outfit NDF, which will continue to be run by managing directors and new shareholders Claudia Sihler und Hansjoerg Fueting.
Screenwriter Michael Baier and the family of late NDF founder Wolf Schwarz also partnered on the buyout.
U.S. billionaire producer Haim Saban is completing his purchase of Kirch’s broadcasting and library assets.
Kirch Media collapsed last year after compiling billions of dollars of debt.