German publishing giant Axel Springer has backed out of its planned €3.5 billion ($4.24bn; £2.38bn) acquisition of satellite broadcaster ProSiebenSat.1 following a decisive "nein" from the country's competition regulators.

The owner of best selling tabloid daily Bild and the television company have abandoned the deal because of doubts about an appeal to the German economy minister against the Federal Cartel Office's ruling [WAMN: 18-Jan-06].

The regulator and media watchdog KEK were concerned the union would dominate the country's advertising market and have too much influence on public opinion.

In a statement the two companies said: "In the light of the numerous and legal uncertainties, a possible appeal or a possible application for a ministerial permit would have resulted in unacceptable risks for all parties involved".

As a consequence, the broadcaster, controlled by US billionaire Haim Saban and fellow investors, is already in talks with other European broadcasters, reportedly TF1 of France and SBS of Luxembourg.

The ending of negotiations has effectively scuppered Axel Springer's chances to create an empire rivalling that of Germany's biggest media group, Bertelsmann.

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