Kirch
BERLIN -- Despite kidvidder EM.TV's much-hyped announcement last month of its intention to sell a 49.9% stake in the Jim Henson Co. to an investment group headed by former UPN chief Dean Valentine, the German kidvidder now says it doesn't expect to seal the deal until the end of February.
News comes in the wake of a growing scandal involving EM.TV chief Werner Klatten and bankrupt media tycoon Leo Kirch, who allegedly engineered Klatten's EM.TV buyout last year.
German cartel authorities are preparing to probe Klatten's 25% acquisition of EM.TV to see whether Kirch secretly secured a loan to Klatten provided by a Dutch financier, violating antitrust laws.
EM.TV said Tuesday it was still negotiating with the Valentine group but added -- perhaps notably -- that other investors were interested in Henson. As a result, a final deal would not be signed until the end of February, officials said.
The company hopes to delay another 30 days at least a portion of a large loan payment due at the end of January. EM.TV aims to use proceeds from a Henson sale to complete the loan payment.
In a related move, EM.TV is monetizing as cash certain payments anticipated from TV producer Sesame Workshop for its acquiring rights to Henson-created "Sesame Street" characters last year. Proceeds will be used to pay a portion of EM.TV's due loan payment, officials said.
Working out the agreement with Sesame Workshop was considered key to EM.TV's closing the Valentine acquisition. But other financing impediments still remain for the bidding group.
Meanwhile, billionaire producer Haim Saban -- who's also been in talks for Henson -- is the prime candidate to pick up all of EM.TV if Klatten's ownership is found to be invalid.
Former EM.TV topper Thomas Haffa, who sold his 25% stake to Klatten, may seek to take back the asset and offer it to Saban if authorities find evidence that Klatten knew of Kirch's support.
Saban also is continuing his efforts to acquire bankrupt giant Kirch Media, even though German publisher Heinrich Bauer is finalizing a takeover.
On yet another front, Haffa and his brother, former EM.TV finance chief Florian Haffa, may get off with a fine in their trial, which is due to wrap next month. The brothers are accused of misleading investors by knowingly releasing wildly inaccurate forecasts in 2000 and manipulating the company's stock price.
An expert's report to the court failed to find a link between the false figure reports and a change in EM.TV's stock price, a point that was the crux of the prosecutor's argument and one of the main charges against the Haffas.
(Carl DiOrio in Los Angeles contributed to this report.)
Contact Ed Meza at
ed.meza@mannaa.de