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Forget the Wall Street Crash, watch EM.TV!

EM.TV boss Thomas haffa thought that he had saved his company by making a deal with Leo Kirch. It was announced on Monday that Kirch has bought 16.74% of EM.TV and taken over almost all of Haffa's shares in Bernie Ecclestone's Formula One group of companies. Kirch now owns 49% of the F1 business with Haffa retaining only one percent. However Haffa said that with the money from Kirch he now intends to take up the option he has to buy a further 25% of the F1 business from an Ecclestone family trust, raising his stake to 26% and leaving the Ecclestone Family with only 25% of the firm, although Bernie Ecclestone is understood to have an agreement which leaves him in charge of the company for as long as he wishes to remain.

There are no details as to how much Kirch has paid to buy into the two companies but we understand that some of the EM.TV shares were acquired with shares in Kirch companies. It is unlikely that Bernie Ecclestone will have accepted shares and so it is safe to assume that he has now added another $1bn to the family fortune.

As part of the agreement Kirch has assumed a large amount of EM.TV debt.

The announcement leaves Haffa is control of EM.TV although his brother Florian resigned from the firm over the weekend, accepting that he has no credibility left with investors.

The announcement did nothing to help EM.TV shares on the Neuer Markt in Frankfurt. By lunchtime on Monday the share price had fallen 25% in two hours and in the early afternoon it dived below the 10 Euro ($8.5) mark, reducing the value of the EM.TV company to only $1.25bn.

The implication in all this is that the markets are not interested in the new deal and it looks like Thomas Haffa is going to have to depart before the share price recovers.

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