Axel Springer prepared to forgo acquisition of ProSieben
11.01.2006
Although in discussions with the Commission on Concentration in the Media (KEK) Axel Springer had refused to part with a TV station, today it announced that in view of the significant competition concerns expressed by the Bundeskartellamt it would be prepared to forgo a permanent acquisition of the TV Station ProSieben.
Accordingly, Springer would be willing to sell ProSieben GmbH (including the TV station ProSieben) to an independent purchaser and to refrain from marketing ProSieben via SevenOne Media GmbH.
According to a preliminary assessment of the Bundeskartellamt the merger could still only be cleared subject to a suspensive condition. This would be that
1. the sale of ProSieben to an independent purchaser and
2. the marketing of the TV station ProSieben via a third party rather than SevenOne Media
take place before the merger and that
3. the Bundeskartellamt has given its consent to the sale of ProSieben GmbH to a purchaser.
Bundeskartellamt President Dr Böge: “The suspensive condition ensures that the TV station ProSieben, which holds a market share of approx. 20 per cent in the national TV advertising market, is not taken over by Axel Springer AG and that the TV advertising time slots are marketed by a company which does not belong to the Springer group.”
An exclusion of the TV station ProSieben from the acquisition project would significantly improve the competitive conditions on the TV advertising market, which is currently characterized by an uncompetitive duopoly. Selling ProSieben to a third party would not prevent a strengthening, albeit to a lesser extent, of Springer’s dominant position in the reader market for over-the-counter newspapers and the advertising market. However, according to the Decision Division’s preliminary assessment, the ensuing improvements in the TV advertising market would outweigh the deterioration of competitive conditions in the reader and advertising markets affected.
According to Böge the merger will only be cleared if the requirements of the suspensive condition are fulfilled.