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Analysts, who say a listing will boost the company’s visibility and fill its war chest with cash for future takeovers, have long awaited a Bertelsmann IPO. A spokesman for Bertelsmann called the deal a "logical next step toward an IPO.
BERTELSMANN TAKES
CONTROL OF RTL
After A Quick Invasion, The Belgians Cough Up Control Of Europe’s Largest Broadcaster
German media giant Bertelsmann AG is set to increase its ownership and thus gain control of Europe's largest broadcaster. The move is being viewed by many as a step toward eventually listing Bertelsmann as a publicly traded company.

According to various media sources, Bertelsmann has agreed to buy an additional 30% of RTL Group Plc from Belgium's Group Bruxelles Lambert. In exchange, GBL will reportedly receive a 25% stake in the German media company. The transaction is worth much more than the 4.2 billion euros ($3.95 billion) market value of 30 percent of RTL, because Bertelsmann—which already holds about 37% of RTL—gains control of the company.

The U.K.'s Pearson Plc owns 22%, and the remaining 11% is publicly traded.

GBL will have the right to sell all or part of its stake in Bertelsmann to the public. "We all feel it's important for a company of this size and stature to be on the stock exchange," said a GBL spokesman. "And we have a common agenda to put this company on the stock market in three to five years."

Analysts, who say a listing will boost the company's visibility and fill its war chest with cash for future takeovers, have long awaited a Bertelsmann IPO. A spokesman for Bertelsmann called the deal a "logical next step toward an IPO.

The move is also part of Bertelsmann Chairman and CEO Thomas Middelhoff's attempt to strengthen the company's music, online and broadcasting businesses, in an effort to compete more effectively with AOL Time Warner and Vivendi Universal.

Based in Luxembourg, RTL's channels include Germany's RTL and France's M6. The company was formed last year by combining CLT-UFA. If any of that sounds familiar to you, please feel free to drop us a note.

"Bertelsmann and Pearson expect that this announcement will facilitate their plans to increase the proportion of publicly traded shares in RTL Group," the companies said in a statement released through the U.K.'s Regulatory News Service.

On Friday, RTL confirmed its plans to merge its broadband interactive television activities with those of Bertelsmann in a deal worth 12.8 million euros.

 

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