NOVEMBER 30, 2000
Kirch ready to pounce on EM.TV
The latest rumors in Frankfurt are that Haffa and his brother Florian are on the point of selling their majority shareholding in EM.TV to Thomas Haffa's former boss Leo Kirch. The deal would be worth something in region of $1bn to the Haffa Brothers and probably more as the value of EM.TV is expected to double if the deal goes ahead. The EM.TV share price is currently wavering at around 20 Euros a share and analysts reckon that the sale could hike that to 40 Euros or more.
The deal is interesting for Kirch for a number of reasons. It would greatly increase his library of cartoon programming and his range of merchandise. At the same time it will put him in a strong bargaining position when it comes to renegotiating the digital rights to Formula 1 in Germany.
Kirch was the original backer of Bernie Ecclestone's multi-channel digital TV service in F1 but struggled to make it pay. Eventually Kirch had to restructure his TV empire but thanks to an arrangement with German telephone company Deutsche Telekom to open up its cable network to digital TV broadcasters rather than having to rely on subscribers buying satellite dishes and backing from Italian Silvio Berlusconi and Saudi Arabian financier Prince Al Waleed, Kirch has been more successful in recent months. Having other TV companies around the world helping to fund his empire through F1 makes a great deal of sense and at $1bn it is a bargain.
It is a deal which appeal to F1 boss Bernie Ecclestone as he has had lengthy dealings with Kirch in recent years and even discussed selling his a share of the company before Haffa arrived on the scene.