Was ist das? German courts examine anti-trust agency decision against Axel Springer

A year ago last January the German anti-trust office (Bundeskartellamt) seemed rather pleased with itself when it deemed Axel Springer’s bid for ProSiebenSat “unacceptable under competition law.” As the world knows, Axel Springer’s CEO Matthias Doepfner wasn’t pleased but they fought the good fight and moved on…to court. The German Federal Court of Justice (September 25) overruled a district court decision vacating Axel Springer’s complaint against the anti-trust office.

The fight Mr Doepfner wants to have…and win…with the anti-trust office is about whether or not Axel Springer or any other media company can expand through acquisition within Germany. At the heart are the complex rules on ownership using audience and ad market share to determine ‘fairness’. The result – currently in place – is interlocking directorates, often including Axel Springer and Bertelsmann, the two largest German media companies.

The Federal Court (BGH) will now examine whether or not the Bundeskartellamt’s decision was correct. Its decision could take months.

An Axel Springer spokesperson said the company is still interested in ProsiebenSat. Certainly teams of lawyers from ProSiebenSat, currently majority owned by private equity firms KKR and Permira, are studiously reviewing the Federal Courts’ statement.

The possibility of the Federal Court eventually voiding the KKR/Permira purchase of Haim Saban’s shares is exceedingly remote. Too great would be the ‘damages’. And it would be a very long court fight leading to even greater damages. However, if KKR/Permira could be persuaded to sell (i.e. €€€) the path through the anti-trust office might be cleared.

Mr. Doepfner may well get what he wants, a restructuring of German media ownership rules and Axel Springer in the television business. - September 26 , 2007

Keywords:Axel Springer, ProSiebenSat

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