Germany's Bertelsmann Considers Reducing Stake in RTL Group

COLOGNE, Germany -- German media giant Bertelsmann said late Thursday that it is considering selling off a substantial portion of its 92.3 percent stake in RTL Group, Europe's largest broadcaster and the owner of FremantleMedia, producer of reality TV hits X Factor and Idol.  

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Bertelsmann informed the board of directors of RTL Group that it might reduce its stake, if market conditions were favorable, but said it would continue to hold a qualified majority of “approximately 75 percent."

RTL is Europe's largest television and radio group, operating 54 TV and 29 radio channels across 10 countries. Among its flagship channels are RTL, Vox and Super RTL in Germany, M6 in France and Spain's Antena 3. It also controls a pan-European group of production companies, most prominently British format giant Fremantle and Germany's Ufa.

The move to sell part of RTL is an about-turn for Bertelsmann, which spent billions buying back stock in the company a few years ago. It comes in the wake of a strategic overhaul of Bertelsmann launched by CEO Thomas Rabe, who wants to shift the company's focus from its core business in European TV to faster-growing digital media markets and to developing territories in Asia and Latin America.

To facilitate this, Rabe had admitted Bertelsmann might need to make several strategic acquisitions. Selling off a stake in RTL could give Rabe the necessary capital to carry out his plans.

"The goal is to make Bertelsmann a faster growing, more digital and more international company in the years ahead," Rabe said. "The planned transaction would prepare the ground for this."

Rabe, however, insisted that RTL Group and the traditional TV business would remain "a very successful core business for Bertelsmann and a strong pillar of our portfolio."