Ailing German media giant Kirch Gruppe professed itself “astonished” after newspaper publisher Axel Springer revealed it is planning a lawsuit to force Kirch to honour a €767 million ($670m; £473m) payment due by the end of April.

In January, Springer exercised an option compelling Kirch to buy back the newspaper giant’s 11.8% stake in broadcast unit ProSiebenSat.1. However, Kirch argues the demand is no longer “legally binding” [WAMN: 31-Jan-02].

Saddled with debts of €6.5 billion, Kirch may be unable to make the payment even if it is obliged to honour the option. In such a scenario, Springer is said to be considering an insolvency filing against the group.

The newspaper group admitted at the weekend it was preparing a lawsuit to force the buyback, but made no comment on potential insolvency proceedings: “Our ultimate interest is to find a constructive solution, not a destructive one,” it declared.

If the court were to approve any insolvency filing, it would spell disaster for Kirch’s frantic attempts to restructure its debts. Such efforts continued Monday, as the company’s creditors attended a meeting with vice-chairman Dieter Hahn in Munich.

No final plan has been put together yet, though creditors were presented with a series of proposals, thought to include the partial or total disposal of assets such as Kirch’s majority stake in Formula One motor racing, its 40% holding in Springer and its cash-haemorrhaging pay-TV platform Premiere World.

A completed plan for restructuring is expected to take at least a further two to three weeks to complete.

Data sourced from: Handelsblatt (Germany); Financial Times; BrandRepublic (UK); additional content by WARC staff