MARCH 26, 2002
Now Murdoch and Berlusconi are moving in on Kirch
THE latest twist in the convoluted tale of Kirch is that the troubled F1 commercial rights holder could be about to give up Kirch Media to Rupert Murdoch, Silvio Berlusconi and the investment bank Lehman Brothers. Kirch Media is the organization which controls the shares in SLEC, the company which controls the Formula One group of companies.
According to sources in Germany, Leo Kirch is being forced to accept the deal to avoid the business going into liquidation. It will not only mean the takeover of the F1 commercial deal but also ProSiebenSAT.1 - the most powerful force in German broadcasting - will pass into foreign hands. This has been greeted in Germany by fears that Murdoch and Berlusconi could use the company to sway political opinion.
It is not clear what the investors would do with the group but it is quite likely that parts of the business will be sold to help recoup the costs of the deal. There may be a deal in which the Kirch Family has the first option to buy them back.
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