Viacom Stalks Ailing German Network

17 May 2004

Viacom is poised to make a bid for Viva Media, the loss making German music channel.

If successful, the US parent company of MTV Music Networks would strengthen its hold on the sector in Europe.

The move comes as Viva is struggling with declining ratings due to competition from MTV.

The German company recently posted first-quarter operating losses of €2.6 million ($3m; £2.7m) on revenues of €22.9m.

A Viacom takeover of Viva could attract the attention of competition regulators in Brussels.

The German channel, which operates in the Netherlands, Hungary, Switzerland and Poland, is one of MTV's main rivals.

Over the last few months Viva has been approached by several interested groups including rival German broadcasters ProSiebenSat.1 and RTL.

Viacom appears to be prepared to outbid them with a deal which would value the company at €300m.

The deal may be complicated by the fact that Time Warner owns a 49% stake in Viva's second channel, Viva Plus.

Viva was established by a consortium of music companies hoping to benefit from the success of music television.

It tried to combat a drop in ratings and a consequent slump in advertising by buying programming like the cult cartoon South Park.

Paradoxically the show is broadcast in the US on Viacom-owned Comedy Central.

Data sourced from: Financial Times; additional content by WARC staff