Saban Capital Group Acquires Voting Control of ProSiebenSat.1 from KirchMedia
11 August 2003
MUNICH, Germany – Aug. 11, 2003 – A subsidiary of Saban Capital Group, Inc. (SCG), the private investment firm of media entrepreneur Haim Saban, and KirchMedia GmbH & Co KGaA (KirchMedia) announced today that they have completed an agreement in which SCG acquired the majority of the voting rights of ProSiebenSat.1 Media AG, the largest private television network in Germany.
Through a subsidiary, SCG acquired 36 percent of the share capital of ProSiebenSat.1 Media AG (72 percent of the voting rights). The acquisition was financed with equity from SCG and additional financing from SCG Investments I Corp., Bain Capital L.L.C., Hellman & Friedman LLC, Thomas H. Lee Partners, L.P., Providence Equity Partners, Inc., Quadrangle Group LLC and Alpine Equity Partners L.P.
The creditor committee of KirchMedia approved the transaction on August 05, 2003, after the recommendation of insolvency administrator Dr. Michael Jaffe. The approvals of the Bundeskartellamt (federal anti-trust authorities) and the Kommission zur Ermittlung der Konzentration im Medienbereich (commission on concentration in the media) have already been received.
Haim Saban, Chairman and CEO of SCG, said: “We are pleased to have completed this agreement with KirchMedia and to enter one of the world’s most exciting media markets. ProSiebenSat.1 has outstanding assets and a talented employee base. By providing enhanced capital resources and necessary stability, we are confident that ProSiebenSat.1 has the potential to become the most successful television broadcasting company in Europe. We are looking forward to working together with the management team headed by Urs Rohner on the future of the channels.
We recognize the challenges in returning ProSiebenSat.1 to higher earnings, but we are committed to a long term business plan and are excited about the opportunity to enter the German market at this time,” said Adam Chesnoff, President and Chief Operating Officer, Saban Capital Group.
The insolvency administrator Dr. Michael Jaffe and KirchMedia consultant Hans-Joachim Ziems have reached a significant step during the selling process of KirchMedia. Jaffe said: “It was the task of the insolvency administrator to act both in the best interests of the creditors and to provide the best possible solution for the assets of these channels. This has been successful. The creditors’ committee decided unanimously that Haim Saban’s offer was both plausible and attractive.”
Hans-Joachim Ziems added: “The completion is to a large extent the execution of already negotiated contract terms, which had been mutually agreed upon with insolvency administrator Michael Jaffe during the insolvency management period. I am very pleased that the efforts in the past months led to this excellent result.”
The CEO of ProSiebenSat.1, Urs Rohner is delighted about the acquisition and closing: “We are pleased that we now have a clear and stable ownership structure again. With SCG we have gained extremely professional and internationally experienced partners with whom we will significantly increase the speed of our business processes. For us a new and exciting chapter of our company history is starting today. We have been looking forward to this for a long time and have great expectations.”
SCG was advised by Alpine Capital Group and JP Morgan on this transaction.
About ProSiebenSat.1 Media AG
ProSiebenSat.1 Media AG is Germany’s largest TV company. Formed in 2000 by merging ProSieben Media AG and Sat.1, the group has four strong TV stations – Sat.1, ProSieben, Kabel 1 and N24 – and holds a leading position in both the multimedia and merchandising fields. Through its shareholding in Euvia Media, the Group has entered the promising area of Transaction-TV. The publicly listed MDAX company has 2,900 employees in Munich and Berlin.
About Saban Capital Group
Saban Capital Group, Inc. (“SCG”) is a private investment firm specializing in the media and entertainment industries. Based in Los Angeles, SCG was established in 2001 by Haim Saban, founder of global family entertainment company Saban Entertainment, a global television broadcasting, production, distribution, merchandising and music company that was sold to the Walt Disney Corporation in October 2001 in a $5.2 billion transaction. The firm makes both controlling and minority investments in public and private companies and adds strategic value through its established relationships and industry experience. In addition, SCG owns and operates a music company, Saban Music Group, which operates an independent music-publishing company.
About Thomas H. Lee Partners L.P.
Thomas H. Lee Partners, L.P. is a Boston-based private equity firm focused on identifying and acquiring substantial ownership positions in growth companies. Founded in 1974, Thomas H. Lee Partners currently manages approximately $12 billion of committed capital. Notable transactions sponsored by the firm include: American Media, Inc., AXIS Capital Holdings Limited, Houghton Mifflin, TransWestern Publishing, National Waterworks, Endurance Specialty Insurance, Vertis, Eye Care Centers of America, Cott Corporation, United Industries, Rayovac, Fisher Scientific International, Experian, GNC and Snapple Beverage.
About Bain Capital
Bain Capital is a global private investment firm that manages several pools of capital including private equity, high-yield assets, mezzanine capital and public equity with over $15 billion in assets under management. Since its inception in 1984, the firm has made private equity investments and add-on acquisitions in over 225 companies around the world, in a variety of sectors, including media and entertainment. Bain Capital partners with exceptional management teams in order to build long-term value in its portfolio companies. Headquartered in Boston, Bain Capital has offices in Munich, London, New York, and San Francisco. For more information visit www.baincapital.com.
About Hellman & Friedman LLC
Hellman and Friedman LLC is a San Francisco-based private equity investment firm. Since its founding in 1984, the Firm has raised and managed $5 billion of committed capital and invested in over 40 companies. The Firm’s strategy is to invest in superior business franchises and to be a knowledgeable and value-added investor in select industries, including financial services, media, marketing, professional services, and information services. Representative investments include the Nasdaq Stock Market, Inc.; Arch Capital Group Limited; Young & Rubicam, Inc.; Formula One Holdings, Ltd.; Western Wireless Corporation; Voicestream Wireless Corporation; Eller Media Company, Inc.; Franklin Resources, Inc.; and others. For more information on Hellman & Friedman, visit www.hf.com.
About Providence Equity Partners Inc.
Providence Equity Partners Inc. is one of the world’s leading private investment firms specializing in equity investments in media and communications companies. The principals of Providence Equity manage funds with over $5.0 billion in equity commitments, including Providence Equity Partners IV, a $2.8 billion private equity fund, and have invested in more than 60 companies operating in over 20 countries since the firm’s inception in 1991. Providence Equity’s current and previous areas of investment include television and radio broadcasting, cable television content and distribution, wireless and wireline telephony, publishing and other media and communications sectors. Recent investments include YES Network, Craig Media, Mountain States, Casema and eircom. Visit www.provequity.com‘ for additional information.
About Quadrangle Group LLC
Quadrangle Group LLC manages Quadrangle Capital Partners LP, a private equity fund that specializes in the media and communications industries. The firm also invests in financially troubled companies across industry groups through a separately managed distressed debt investment program. Quadrangle Group was founded in March 2000 by four former Managing Directors of Lazard Freres & Co. LLC who have more than 60 years of combined experience in private equity and in media and communications. Additional information may be found at www.quadranglegroup.com.
About Alpine Equity Partners L.P.
Alpine Equity Partners L.P. is a New York based merchant banking firm and an affiliate of Alpine Capital LLC, a mergers and acquisitions advisory firm principally involved in media, entertainment, communications and financial services. Included in the Alpine Equity Partners L.P. portfolio are investments in Daily Racing Form. LLC, Sit-Up Ltd., and Money Mailer LLC
For KirchMedia GmbH & Co KGaA:
rw konzept GmbH Rudolf Wallraf, +49 (0)89 99562324 Mobile: +49 (0)170 4332832
or For Saban Capital Group in Germany: Citigate Dewe Rogerson GmbH
Bernhard Meising, +49 (0)211 5775 902
Elisabeth Ramelsberger, +49 (0)211 5775 913
or For Saban Capital Group in the US: Citigate Sard Verbinnen
Stephanie Pillersdorf, +1 212 687 8080.