ProSiebenSplat

13 March 2003

The price looks settled. But the partnership hopes to get away without buying out other ProSieben investors. That’s unacceptable. In what looks like the last act of the KirchMedia auction, Haim Saban and TF1 are left as the lone joint bidder for the media group.

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Haim Saban and TF1 are examining ways to avoid making a mandatory offer to minority shareholders in ProSiebenSat1 if they buy its majority shareholder KirchMedia, according to a person familiar with negotiations on the sale of KirchMedia by its creditors. Following the withdrawal of Bauer Verlag, the publishing group, from the auction for KirchMedia, a pairing of Saban and TF1 is the only remaining bidder for the former broadcasting and rights trading arm of the Kirch Group. TF1 is said by the person to be planning to take 25.1% of KirchMedia.

The E2bn offer is understood to put a major part of KirchMedia's value on its film and TV rights library. Kirch's creditor banks would retain a significant stake in the library.

KirchMedia's other major asset is a 52.5% stake in quoted German broadcaster ProSiebenSat1, including 88.5% of its shares with voting rights. Under Germany's takeover law, a buyer of 30% or more of a company must make an offer to its other shareholders, either at the price at which it took its stake over the threshold, or at the 90day average price of its shares. In ProSiebenSat's case, the 90day average price is about E6.20, higher than the shares' value on 13 March of E5.60. At the latter price, ProSieben's market capitalisation is E1.1bn, valuing the minority stake at just over E500m.

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