Bertelsmann drops bid for RTL Group
EmptyMUNICH -- German media giant Bertelsmann has dropped plans to buy out the remainder of RTL Group, Europe's biggest broadcaster, because even a complete takeover might not lead to the removal of Luxemburg-based RTL's stock from public trading, the company said late Thursday.
"Bertelsmann has come to the conclusion that at this point in time, there is no certainty that Luxemburg's takeover law ... would apply in the case of a successful offer (for RTL's remaining stock)," read the statement. "As there is no dependendable legal basis for Bertelsmann to raise its interest in RTL Group to 100%, Bertelsmann has decided not to pursue its plans to make an offer."
The German media giant already owns 89.8% of the publicly traded broadcaster, its most profitable subsidiary, and has attempted to acquire the remaining 10.2% before but could not agree on a price. On Dec. 4, Bertelsmann announced that it was once again seeking to acquire full control of RTL.
Then early Thursday, RTL's stock was removed from trading in Luxemburg and Frankfurt. That sparked a slew of speculation that Bertelsmann was about to announce a deal.
Neither Bertelsmann nor RTL Group would comment during the day. Bertelsmann released its statement at 6 p.m. local time, saying that it had decided against trying to buy out the broadcaster after checking into the legal situation.
"But Bertelsmann reserves the right to acquire more RTL stock," the statement continued, "and to pursue all current or in future available possibilities in order to pursue its strategic goal of removing RTL from public trading."
Bertelsmann's incoming CEO Hartmut Ostrowski, who takes over the concern as of Jan.1, has stated that his goal for the company is 30 billion euro ($43 billion) in annual income by 2015. Because RTL is responsible for the lion's share of Bertelsmann's revenues, making the broadcaster a fully-owned subsidiary would have been a sensible first step in achieving that ambitious goal. But the price tag for the remaining one-tenth of RTL would have been high, likely upward of a billion euros ($1.43 billion).