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Hollywood billionaire buys Kirch
MUNICH, Germany (Reuters) -- Hollywood billionaire Haim Saban agreed to buy Germany's largest TV broadcaster on Monday, winning a battle even media mogul Rupert Murdoch lost. Insolvent German media group KirchMedia said it had signed off the sale of its TV station to Saban in the first part of a two-tiered deal that also includes its vast film rights library. The deal comes after a dramatic year-long auction, which has opened up Germany's clubby media industry, dominated by German-owned private and state-run stations, to the control of a foreign investor for the first time. "I am elated and extremely happy,'' Saban told reporters in Munich. "The chance to take over a majority in Germany's most important broadcasting group doesn't come up often.'' The man who made his fortune with children's TV figures such as the "Ninja Turtles'' is buying a majority stake in ProSiebenSat.1 Media AG as part of a complex deal worth some two billion euros ($2.2 billion) in total. Saban has won a muddled auction that has been going on since KirchMedia filed for insolvency last year trumping German publisher Heinrich Bauer Verlag and Germany's second-biggest bank HVB Group, which withdrew their offer last week. But in yet another surprise twist to the battle for the leftovers of Leo Kirch's once mighty media empire, Saban has not signed off the complete deal yet, and he signed it alone. KirchMedia played down the missing signature under the film library part of the deal, saying that part of the contract would be signed in the next 10 days and the delay was only due to final discussions about legal technicalities. "We have reached an agreement about all terms and conditions of this contract as well,'' KirchMedia said in a statement. ``Until it can be signed, 40,000 pages of documents have to be considered and bundled into a contract.'' PROSIEBEN TAKEOVER OFFER?Also missing under the deal is the signature of French TV group TF1, which had bid for ProSieben together with Saban earlier. "TF1 is welcome at any time between now and the closing of the deal to join with any stake between one and 50 percent,'' Saban told reporters in Munich, adding there would be no financing problems without TF1. KirchMedia and Saban declined to comment immediately on the price of the ProSieben sale, which sources had earlier put at some 500 million euros for the 36 percent stake -- carrying 72 percent of the voting rights -- KirchMedia owns directly. The full deal is worth some two billion euros in cash and assumed debt, but not including a mandatory takeover offer to all ProSieben shareholders, which Saban has to file under Germany's takeover code. Sources familiar with the negotiations say Saban may seek a regulatory exemption by arguing that ProSieben has become a ``restructuring case.'' ProSieben last month posted a 40 percent drop in core profits and warned that the weak economy could keep crucial advertising revenues under pressure in 2003. The new owners are likely to have to inject fresh capital. Some sources say they could commit around 300 million euros in new funding. The deal is subject to approval by KirchMedia's creditors -- banks including Commerzbank, BayernLB, and HVB Group, insurers and movie studios -- which are owed billions of euros and which are scheduled to meet again next Wednesday. The deal also needs regulatory approval from the German cartel office and a media watchdog before it can be closed. N.M. Rothschild & Sons is advising Saban. UBS Warburg is advising KirchMedia. Copyright 2003 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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