The German media giant Kirch will not be able to buy as big a stake in the troubled film and television rights company, EM.TV, as it originally planned, it said today.
As part of capital tie-up announced earlier this year, Kirch was to have held 16.7 per cent of EM.TV's share capital and 25.1 per cent of its voting rights.But the German competition watchdog, the Federal Cartel Office, has refused to give its blessing to those plans and the two partners will have to go back to the drawing board, a Kirch spokesman said.
"We will hold discussions with EM.TV with the aim of finding a structure for the company and a holding (by Kirch) which does not raise any competitive problems," the spokesman explained.
When asked if that meant Kirch's stake in EM.TV would be smaller than originally planned in EM.TV, the spokesman replied: "Yes."
The German cartel authority stipulated that it could only approve the tie-up if EM.TV shed its 45-per cent stake in the film rights company, Tele Muenchen (TMG), a direct competitor to Kirch.
But EM.TV and Kirch have been unable to persuade TMG's head Mr Hubert Kloiber, a long-standing rival of Kirch, to play ball and the would-be partners will now have to come up with an alternative plan.
The Kirch spokesman refused to say how big Kirch's final stake in EM.TV could be.
But Mr Werner Klatten, who was officially named EM.TV's new chairman today, told a news conference that a stake of 10-15 per cent would be feasible.
Mr Klatten, who is to replace EM.TV's founder, chairman and major shareholder Mr Thomas Haffa, said that the current changes at EM.TV would not jeopardise the company's joint plans with Kirch for Formula One racing.
The two partners hold a joint 75-per cent take in SLEC, the company which holds the commercial and broadcasting rights for Formula One.
AFP