ProSiebenSat.1 and MediaForEurope ‘getting closer’

Bert Habets

ProSiebenSat.1 has begun collaborating more closely with its largest shareholder, MediaForEurope (MFE), across a range of areas, according to CEO Bert Habets.

Habets told the Financial Times newspaper that the German broadcaster had begun cooperating more closely with MFE across advertising, technology and potentially content over the last few weeks.

Habets said that ProSiebenSat.1, which has been hit hard by the advertising downturn in the German market, was in a “much more constructive dialogue” with MFE than has hitherto been the case.

He said that the entry into the advertising market of streamers such as Netflix had an impact on how advertisers were allocating budgets and that there was a need on the part of national broadcasters to gain access to global ad budgets.

Habets also said that there was strong potential for collaboration between MFE and ProSiebenSat.1 on technology, and that there may possibly be scope for collaboration on content, pointing to the ability of Netflix to make a success of series produced in the likes of Spain successful in other international markets.

MFE has long sought to promote the benefits of cross-border cooperation and mergers between broadcasters in Europe. The company’s stake in ProSiebenSat.1 is very close to the 30% threshold that could trigger a mandatory takeover offer. Following a rounding up exercise in May, MFE held 28.7% of ProSiebenSat.1’s shares directly or indirectly and 29.7% of the voting rights.

Habets declined to comment on the possibility of a bid or merger between the pair, but told the FT that this had not been part of discussions between the pair to date.

Habets’ predecessor at ProSiebenSat.1, Rainer Beaujean, was strongly opposed to the idea of a merger with MFE and highly sceptical of the value of cross-border consolidation in Europe.

However, analysts speculated that Habets’ accession to the CEO role towards the end of last year, and the company’s weakening performance, could concentrate minds.

ProSiebenSat.1 saw its earnings plummet in the second quarter as the German market’s advertising weakness took a heavy toll on its top line.

Group revenues dropped by almost half to €868 million in Q2, down from €1.043 billion last year, and adjusted EBITDA plummeted from €155 million a year ago to only €79 million.

The company has also been cutting jobs as it realigns its business towards digital and its Joyn streaming platform.