Axel Springer Backs Out of TV Compromise

18 January 2006

German newspaper giant Axel Springer's entry into the country's TV market is hanging in the balance.

The company's controversial bid to buy number one pay-TV platform ProSiebenSat1 has met with stiff opposition from regulators. Springer had hoped to overcome their objections by offering to dispose of one of ProSieben's four channels if the €4.15 billion deal ($5.01bn; £2.84bn) went through.

The Federal Cartel Office, however, has insisted that the sale of the TV channel should go ahead before Springer's takeover of the whole business.

Springer has now decided it cannot comply with the condition, saying "it is legally not an option".

The company, which owns the best-selling tabloid daily Bild, expects the Cartel Office to block the whole deal, a move it will probably appeal.

The Cartel Office and the media watchdog KEK are concerned that the purchase would give Springer too much influence over the country's media and, together with giant rival Bertelsmann, create a near duopoly in the advertising market.

Data sourced from Wall Street Journal Online and Data sourced from BBC Online; additional content by WARC staff