Premiere says it has eyes on another German player

Sat.1 would make for 'perfect fit'

Some of Rupert Murdoch's moxie seems to be rubbing off on Premiere. The German pay player, in which News Corp. controls a 22.7% stake, is looking to buy Sat.1, one of Germany's largest free-TV channels.

"We're interested in acquiring Sat.1," Premiere CEO Michael Bornicke told German business daily Handelsblatt on 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. However, 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 is brimming with confidence now that his company, thanks to Murdoch's participation, has been removed from 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 the shareholders meeting in June.

It looks as if Premiere also could 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 ($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 mogul is in the process of merging Swiss licenser Highlight 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 Italy, Murdoch has taken similar legal action to change the way soccer-rights are sold off. News Corp. pay channel Sky Italia has filed a complaint with European Union antitrust officials, arguing that a new Italian law allowing bundled rights packages is anti-competitive. As with the German case, Sky Italia argues that bundling forces broadcasters to buy a product they might not want.