Premiere looking to buy Sat.1

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CANNES -- Some of Rupert Murdoch's moxie seems to have rubbed off on Premiere, the German pay player in which News Corp. controls a 22.7% stake, with Premiere CEO Michael Bornicke telling the German press his struggling pay platform is looking to buy Sat.1, one of Germany's largest free-TV channels.

"We're interested in acquiring Sat.1," Bornicke told German business daily Handelsblatt Monday. "The Berlin-based channel would be a perfect fit for us."

A merger of Premiere -- Germany's leading pay TV group -- with Sat.1 would radically change the German TV landscape. But Bornicke's announcement smacks of the sort of dramatics associated with his dynamic predecessor Georg Kofler, who was a master in stoking Premiere's stock price with a well-placed pronouncement. For its part Sat.1, part of the ProSiebenSat.1 broadcast group controlled by investment groups KKR and Permira, said it is not in talks with Premiere.

Bornicke, however, is brimming with confidence now that his company, thanks to Murdoch's participation, has been taken off the takeover list. News Corp. on Friday boosted its stake in Premiere from 19.9% to 22.7%. Murdoch's group is the largest single shareholder in Premiere and is expected to push for a seat on the company's supervisory board at this year's shareholder meeting in June.

It looks as if Premiere could also get some good news from Germany's Federal Cartel Office. The antitrust watchdog is expected to rule by the end of the month on Premiere's suit against Bavarian mogul Leo Kirch.

Kirch, through his company Sirius SportMedia, signed a 3 billion euro ($4.3 billion), six-year deal to market the rights to Germany's national soccer league, the Bundesliga. But Premiere has balked at Kirch's plans to sell ready-made coverage of games to Premiere and its pay and free-TV competitors. Premiere fears the plan would allow Kirch to eliminate competition by forcing broadcasters to buy his bundled Bundesliga programming.

The octogenarian mogul is in the process of merging Swiss licenser Highlight Communications with Munich-based broadcaster/producer EM.SportMedia to create a European sports licensing, production and broadcasting giant. EM.Sport's production division, Plazamedia, will likely be the go-to group to produce Bundesliga matches.

None of this sits well with Premiere, which relies on the Bundesliga to drive subscriptions.

In neighboring Italy, Murdoch has taken similar legal action to change the way soccer-rights are sold off. News Corp's pay channel Sky Italia has filed a complaint with European Union antitrust officials arguing that a new Italian law allowing bundled rights packages was anti-competitive. As with the German case, Sky Italia argues bundling forces broadcasters to buy a product they might not want.
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