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TS News - Kirch To Sell Telepiu Stake

TELE-satellit News, 4 December 1996

Kirch To Sell Telepiu Stake
  ROME, Italy, 96/12/03 (TS) -- According to an article in Italian daily
"La Repubblica" published on December 3rd, German media magnate Leo Kirch
is planning to sell his 45% stake in Italian pay-TV network Telepiu to
Canal Plus which already owns 45% inherited from Nethold after last
September's merger between the two companies.

  The deal could take place at the beginning of next year and in exchange
Kirch would receive a 32,5% stake in German pay-TV channel Premiere which
is currently held by Canal Plus. Since Kirch already has a 25% stake in
Premiere this means he would be able to control Germany's only pay-TV network.

  Financial analysts estimate Telepiu's value at around 2,000 billion lira
-this amount is reached by multiplying the number of subscribers (currently
800,000) by 1,500 dollars and this is a common method of measure for all
European pay-TV channels. Kirch's current stake in Telepiu is worth around
900 billion while the 37,5 stake in Premiere (total number of subscribers
amounts to 1,2 million) comes to around 1,000 billion lira.

  In order for the deal to go through, on top of all this, Kirch would have
to pay Canal Plus an additional 100 billion or the difference could be
resolved by giving away the TV rights for European football. Interestingly,
there is a possibility that other Italian investors may take a stake in
Telepiu in which Silvio Berlusconi's TV holding company Mediaset already
has a 10% stake. One of them may be Stream, a subsidiary of state
telecommunications operator Stet which is in charge of  development of
cable television distribution services.

(c)TELE-satellit 1996. All rights reserved.
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