German Media Giant Weighs Partial Sale

Kirch Group, Germany’s second-largest media company, might sell between 10% and 20% of the company to large investors, Managing Director Dieter Hahn told a news conference in Munich.

Hahn said founder Leo Kirch will keep 51% of the company while another stake might be sold on the stock exchange, leaving 10% to 20% for interested investors. Hahn added that a decision on an initial offering hasn’t been made and will depend in part on potential partners.

The privately held company said last week it expects talks with potential investors Mediaset, Italy’s largest private broadcaster, Rupert Murdoch’s News Corp. and Saudi Prince Alwaleed Bin Talal to conclude by the end of March. One of the investors said last week that Kirch gave interested parties a document that estimates the net value of the company at $8.8 billion.

Kirch will announce a decision on possible partners in the first quarter of this year, Hahn said, adding that negotiations are in a “final phase.”

Hahn would not comment on potential investors but pointed to existing cooperative agreements with Mediaset. Kirch and Mediaset own part of Telecinco, a Spanish TV network, and Kirch holds 1.3% in Italy’s biggest commercial TV company.

The three investors and Kirch have been in talks for several months about combining their forces to form a pan-European TV production alliance that could compete against major U.S. networks in creating TV programming.

Last week, Kirch Group also announced it will divide into three holding companies to attract more investors and to prepare for selling shares to the public.