Rupe eyes Germany
Talks with Kirch, Deutsche Telekom heat up
The News Corp. chairman confirmed recent rumors Friday saying his company was in talks with Germany's Kirch Group and Deutsche Telekom about possible acquisitions as it struggles to crack the European media market.
Murdoch said News Corp. is talking to Kirch about its German digital TV operation, while it has also been considering buying part of Deutsche Telekom's cable TV systems.
"There have been talks on both fronts. There's absolutely nothing concrete to announce at this stage," Murdoch told reporters in London after British pay TV company BSkyB's annual shareholder meeting.
Minority stake
BSkyB, 40%-owned by News Corp., issued a statement later saying it is in talks with Kirch about possibly buying a minority stake in that company's pay TV platform.
Kirch Group managing director Jan Mojto said during the Mipcom TV trade show in Cannes 10 days ago that any talks with Murdoch would be conducted on "an equal footing." In no way, Mojto suggested, should a Murdoch stake in the Kirch pay TV operation be seen as a rescue effort on the part of the global mogul. The Kirch Group recently failed to raise $1 billion from an aborted bond issue.
Satcaster BSkyB ranks as one of Murdoch's few success stories in Europe, where his continental expansion plans have been blocked by regulatory and political obstacles.
Sole Stream
Murdoch's News Corp. Europe unit, launched a year ago to spearhead his expansion on the Continent, has clinched only one major acquisition to date -- a 35% stake in Italian pay TV company Stream.
As for Deutsche Telekom's cable TV network, Murdoch said News Corp. might join with partners to bid for the operation.
Asked whether News Corp. would bid for all of the network, he said, "I'm sure there are 20 or 30 parties that are talking to Deutsche Telekom, but we don't plan any total bid like that. We may join with partners, but we don't know yet."
Deutsche Telekom is locked in talks with a short list of firms over the sale of the systems, which are attractive because they could be upgraded to carry two-way communication and provide digital TV and high speed Internet access.
On Thursday, Germany's second largest telco, Mannesmann, said its bid to acquire the DT systems had been rejected.
Despite his interest in cable in Germany, Murdoch said he wasn't looking at buying into British cable companies.
"For one, I'm sure we wouldn't be allowed to buy one. And I can't understand the valuations put on them unless you look at them as telephony companies," he said.
Reuters contributed to this report)
