Axel Springer Loses Appeal Against Regulator's Veto of ProsiebenSat.1 Bid
Axel Springer AG, Europe’s largest newspaper publisher, lost a German appeals case seeking to overturn a regulator’s veto of its 2005 planned purchase of broadcaster ProSiebenSat.1 Media AG.
The Federal Court of Justice in Karlsruhe today rejected Springer’s bid to overturn an antitrust regulator’s decision to block the 4.2 billion-euro ($5 billion) acquisition. The country’s top civil court upheld a lower court ruling in favor of the regulator.
Axel Springer has said that it would reconsider a bid for the company if it prevailed in the suit. The transaction was abandoned in 2006 after the Federal Cartel Office said it may harm competition. A Dusseldorf court said in 2008 that ProSieben and Bertelsmann AG’s group of TV companies already had a dominant position in the market for television advertising, so even a small addition might hinder competition.
“The analysis of the Dusseldorf court that the planned takeover would have boosted the dominant market position” of these companies “in the television advertising market stood the test of legal scrutiny,” the top court said in a statement distributed after the ruling was delivered.
Axel Springer will analyze the written judgment before it will comment, said Christian Garrels, a spokesman for the Berlin-based company.
Lower Court Ruling
The judges had said at a hearing earlier today that they are bound by the lower court’s factual findings. The Dusseldorf court had determined that Bertelsmann and ProSiebenSat.1 had a combined market share of more than 80 percent, the judges said.
ProSiebenSat.1 dropped 6.4 percent to 11.25 euros in Frankfurt today. Springer fell 0.6 percent to 78.96 euros.
In a separate case at Germany’s top administrative court in Leipzig, Axel Springer is trying to overturn a media regulator’s veto of the takeover. The company lost a court ruling in that case last year and filed an appeal at the Federal Administrative court, which hasn’t scheduled a hearing.
After Springer dropped its bid, Kohlberg Kravis Roberts & Co. and Permira LLP bought control of ProSiebenSat1 and combined it with SBS Broadcasting to create Europe’s second-biggest broadcaster.
The case is BGH, KVR 4/09.