Kinowelt teams up
Distrib giant sells 5% stake to Munich Re
Kinowelt founders Michael and Rainer Koelmel sold Re 1.2 million shares from their personal holdings. But the proceeds will flow directly into the company, to be recouped by the brothers through a bond issue or capital increase later this year.
That route was taken because Kinowelt isn't allowed to increase its capital under its articles of incorporation.
Kinowelt Medien, like other Neuer Markt players, is feeling the brunt of the wobbly German exchange, where many media stocks have plunged to new depths in recent months.
Hard to raise new money
Currently it's nearly impossible to raise new coin from the stock exchange. Kinowelt was forced to put a bond issue on hold late last year due to market conditions but has since arranged an alternative loan.
While some media players interpreted the move as a sign of weakness, analysts told Daily Variety that wasn't necessarily the case, as it depends on what Kinowelt does with the money.
In a statement, the company said it intends to use the cash to take advantage of the consolidation period to expand in its core businesses.
"With the Munich Re Group, Kinowelt has gained an internationally respected investor who will support our company in its course of long-term growth to become an internationally important media group," Kinowelt CEO Michael Koelmel said.
