TriStar in Talks to Buy Kirch Assets
Sony Corp.'s Columbia TriStar is planning a joint bid with Germany's third-largest bank and a German publisher for KirchMedia, the main entertainment unit of the insolvent German media giant Kirch Group, a source with knowledge of the talks said Sunday.
German bank Commerzbank and WAZ Gruppe, a newspaper group said to be close to German Chancellor Gerhard Schroeder's Socialist Democrats, were in talks with Columbia TriStar to acquire the KirchMedia assets, said the source, who would not comment on financial terms or how control of the assets would be divided.
Reuters reported that the two German parties each are interested in 40% of the company and Columbia TriStar would acquire the remaining 20%.
Kirch Group is trying to find buyers for the businesses of KirchMedia as well as its other entertainment unit, KirchPayTV. Prospective bidders have until the end of the week to express interest in all or part of KirchMedia, the film unit whose main asset is a 52.5% stake in Germany's biggest free-television broadcaster, ProSiebenSat.1 Media.
The transaction involving Sony, if completed, would give the Culver City-based studio a stronger presence in Europe's largest television market and ensure air time for TriStar programs such as "Jeopardy," "Dawson's Creek" and reruns of "Seinfeld." TriStar already provides KirchMedia's broadcasting unit with its Friday night lineup of comedy programming.
The proposed consortium, which would have German companies controlling the majority of the concern, probably would blunt political opposition over the involvement of a foreign media company.
ProSiebenSat.1 controls about a third of the German television market in terms of viewership. KirchMedia also has an extensive film library as well as broadcast rights to popular sports, including soccer, and a money-losing sports channel. The company transferred this year's World Cup soccer rights to a Kirch Swiss subsidiary.
ProSiebenSat.1 has a current market value of about $950 million.
KirchMedia was forced to file for bankruptcy protection in April after it failed to win the backing of existing investors, including Rupert Murdoch. Kirch's bankruptcy lawyers have said KirchMedia needs about $940 million to reorganize and hold on to the main film and television business. The proceedings were triggered in part when Kirch missed a $132-million payment to Columbia TriStar for programming.
