Murdoch makes return to German TV market

Media tycoon Rupert Murdoch has returned to the German TV market by buying a near-15 percent stake in the country's largest pay-TV broadcaster, Premiere, for 287 million euros.

But his News Corp media conglomerate, which owns Fox News Channel and part of BSkyB, does not currently plan to increase the stake in Premiere, a source familiar with the matter told Reuters.

The Munich-based company has repeatedly been at the centre of market speculation that French media group Vivendi was interested in it.

Premiere shares gained 26 percent after the news and closed up 19.94 percent at 15.28 euros on the Frankfurt stock exchange.

News Corp, which recently completed a $5.6 billion buyout of Dow Jones & Co Inc, bought the 14.58 percent stake from German cable operator Unitymedia for 17.50 euros per share.

Unitymedia received 16.4 million Premiere shares last year as a result of a cooperation deal on German Bundesliga soccer games.

"We see enormous potential for growth in Germany and believe the time is right to invest in its foremost pay-TV business, Premiere," News Corp Chief Executive Murdoch said in a statement.

But analysts have said the German TV market was difficult because viewers had more than 30 free programs to choose from and were reluctant to pay extra. Premiere is not Murdoch's first foray into German television. News Corp once owned a 49 percent stake in VOX, which belongs to European broadcasting company RTL Group, owned by Bertelsmann.

He was also involved in media entrepreneur Leo Kirch's Kirch Group, which used to own Premiere.

Premiere had no comment about its new shareholder on Monday.

One Frankfurt-based trader said: "This is good news for the share. The way is now clear for someone to build a stake. This looks like a takeover."

Premiere is in a period of transition with a new chief executive and uncertainty over whether it will win rights to broadcast Germany's top-flight Bundesliga soccer games in the next TV rights auction for coming seasons due this year.

Agencies

(China Daily 01/09/2008 page17)