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| Closing Price 17/5/2012: 50.15 |
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Printing under PDF format There
will be a presentation to analysts and investors at 9.30am today at Pearson
Television, 1, Stephen St, London, W1, followed by a press conference at 11am.
There will be live webcasts of both events on www.pearson.com and www.bertelsmann.de. FOR IMMEDIATE RELEASE 7th
April 2000 Audiofina, CLT-UFA and
Pearson Television merge to create Europe’s leading integrated broadcast and
content group Bertelsmann AG, Groupe
Bruxelles Lambert S.A. (“GBL”) and Pearson plc (“Pearson”), have today agreed to
merge CLT-UFA, Europe’s leading commercial television and radio broadcaster,
with Pearson Television (“PTV”), the world’s leading international
independent television production company. The new group will be
the leading pan-European integrated broadcast and content company with annual
revenues of some e4 billion. It will seek a primary listing on the London Stock Exchange as
from completion of the merger. Bertelsmann
and GBL, the two co-controlling shareholders in CLT-UFA, will reorganise their
interests in CLT-UFA and Audiofina. As a result, Bertelsmann, along with WAZ,
the German publishing company, will have an economic interest of around 37% in
Audiofina, with GBL holding an economic interest of approximately 30%. Pearson will hold an economic interest of 22%
and around 11% will be publicly held. Audiofina, which is listed in Brussels
and Luxembourg, will be renamed, with the new name of the company announced at
a later date. In 1999, the combined
group generated proforma earnings before interest and tax of e459 million (including associates) on proforma revenues of e3.78
billion. At 1 January 2000, the group had a proforma net cash position of e308 million. CLT-UFA
CLT-UFA has interests
in 22 television channels, which attract more than 120 million daily viewers,
and 18 radio stations, which attract more than 25 million daily listeners,
across Europe. The main broadcast
brands are RTL, M6 and Channel 5. In a joint venture with PTV, CLT-UFA is a
major force in television production company in Germany. CLT-UFA also operates
one of Europe’s leading sports rights businesses, marketing the broadcast
rights of some 40 national football teams and 250 soccer clubs across Europe.
It has a rapidly growing online presence, with more than 70 branded internet
sites across Europe that generate some 150 million page views per month. PTV PTV has some 160
television programmes in production in 35 countries around the world, producing
over 10,000 hours of programming every year. It makes sales from its library of
some 17,500 hours of programming to over 100 territories. It owns a leading selection of game show
formats, is the largest producer of serial dramas and makes a wide range of
entertainment programmes. It has shareholdings in broadcasters in the UK,
Hungary, Spain and Australia and in Uproar.com, one of the world’s leading
online entertainment sites. Audiofina Listed on the Luxembourg and Brussels stock exchanges, Audiofina (AUFI.LX/AUFI.BB) currently controls 49.85% of CLT-UFA. In addition, it holds a 28% interest in Groupe Jean-Claude Darmon, the Paris-listed sports rights marketing group. At 31 December 1999, Audiofina had net cash balances of e794 million. Reasons for the
merger The combination of
CLT-UFA and PTV will create an integrated pan-European company with highly
successful business operations spanning television and radio broadcasting,
television production, sports rights and online activities. This will put the
combined company in a better position to achieve stronger revenue and earnings
growth: ·
PTV’s content
will enrich the broadcast channels, enabling them to attract bigger audiences
with more in-house productions; ·
CLT-UFA’s
broadcast channels will provide expanded routes to market for PTV’s content; ·
Access to
Europe’s most important broadcast network will enable the combined company to
be more innovative in developing new television genres, shows and formats; ·
Combining rich
content with powerful cross-promotional platforms on tv and radio will enable
the company to build one of Europe’s leading online and new media presences; ·
The combined
company will have the financial, management, production and broadcasting
strengths to accelerate growth, both organically and through acquisition, in
existing European markets and break into new markets worldwide; ·
The combined company
will also own a 65% stake in Channel 5, the UK’s fastest growing terrestrial
channel. Management and
board structure Didier Bellens, chief
executive of CLT-UFA, will be chief executive of the new group. Richard Eyre,
chief executive of PTV, will be the executive director responsible for leading
the content business and directing the new group’s future development and
strategy. Richard Eyre is also expected to become chairman of Channel 5. Ewald
Walgenbach, chief operating officer of CLT-UFA, will take up the same role in
the new group. In addition to the
executive directors, the company’s board of directors will include 11
non-executive directors, of which six
will be appointed by Bertelsmann and GBL and two by Pearson. Thomas Middelhoff
(CEO of Bertelsmann) Siegfried Luther (Bertelsmann’s CFO), Erich Schumann (CEO
of WAZ), Marjorie Scardino (CEO of
Pearson) and John Makinson (Pearson’s CFO), are all expected to join the board.
GBL will nominate its board representatives at a later stage. Three independent non-executive directors
will be appointed, of whom one will be nominated as chairman. Marjorie Scardino,
chief executive of Pearson, commented: “This deal puts
Pearson Television at the heart of one of Europe’s most extensive – and most
popular – broadcasting networks. It
provides the stage on which talent can really flourish, creating compelling
entertainment across radio, television and new media. We also see the chance for other parts of Pearson to work with
this new company to cross promote our brands and content through all media.” Commenting on the merger,
Bertelsmann CEO Thomas Middelhoff said: “Bertelsmann, in the last few weeks, clearly strengthened its positions
in the area of content and significantly boosted the e-commerce business. We are now catapulting our television
business into a new dimension, enabling the new group to develop new content
and genres for combined television and internet operations. Through Audiofina, one of our expansive core
businesses can utilize the tremendous potential of the stock market for further
expansion for the first time.” Albert Frère, Chairman of GBL, said: “My business partner, Paul Desmarais, and I are very happy with the tremendous progress made by CLT-UFA since the merger some three years ago in transforming Europe’s largest broadcaster into a highly profitable and tightly focused group. Today’s merger marks a further step in the successful strategy developed with our partner, Bertelsmann. The alliance between CLT-UFA and Pearson Television offers great opportunity for growth and the creation of shareholder value.” Please direct enquiries to: Oliver Herrgesell, Bertelsmann AG Corporate Communications Tel: +49 5241 80
24 66 E-mail: oliver.herrgesell@bertelsmann.de John
Fallon, Pearson plc Corporate Communications Tel.: +44
171 411 2310 E-mail:
John.Fallon@pearson.com Patrick De
Vos, GBL Tel.: + 32 2 547 2287 E-mail:pdevos@gbl.be Ingrid Haas, CLT-UFA Corporate Communications Tel: + 352 42142 5020 E-mail: Ingrid_Haas@clt-ufa.com Roy Addison, Pearson
Television Corporate Communications Tel: + 44 171 691 6830 E-mail: roy.addison@pearsontv.com Nicola Weiner, College
Hill (for Audiofina) Tel: + 44 171 457 2020 E-mail: nicola@collegehill.com Notes to Editors THE TERMS OF THE
AGREEMENT Under the terms of an
agreement, dated 7 April 2000, between Audiofina S.A., (“Audiofina”) BWTV GmBH
(a subsidiary of Bertelsmann A.G.) (“BWTV”), Groupe Bruxelles Lambert S.A.,
(“GBL”) and one of its subsidiaries, Electrafina, and Pearson plc, (“Pearson”)
the parties have agreed the following principal terms: I.
In exchange for
the contribution of Pearson TV, Pearson will receive 22% of the enlarged fully
diluted share capital of Audiofina; II.
BWTV and GBL will
reorganise their interest in CLT-UFA
and Audiofina such that they will own, on a 50/50 basis, directly or
indirectly, 60% in Audiofina (of which at least 50.1% will be held through a
joint structure or arrangement (“BWTV/GBL Alliance”)); III.
Pearson TV will
be entitled to all future dividends on Audiofina shares other than the proposed
dividend of 0.75 EUR per share proposed in respect of the year to 31 December
1999; IV.
The transaction
will be conditional on inter alia; (a) the approval of appropriate competition
and regulatory authorities (including the European Commission, under the Hart
Scott Rodino Act and the Independent Television Commission in the UK); (b) the
listing of Audiofina on the London Stock Exchange; (c) certain tax clearances
considered necessary by the parties; (d) the approval of Audiofina shareholders;
and (e) there being no material breach of certain covenants and warranties
given in the agreement; V.
To give certain
mutual pre-completion undertakings, representations and warranties and tax
indemnities; VI.
Certain limited
matters relating to dividend policy, capital increase, corporate governance,
major transactions and significant debt increase will require the approval of
the BWTV/GBL Alliance and Pearson; VII.
The existing
rights of the employees of Pearson TV will be fully safeguarded; VIII.
The parties other
than Audiofina will agree for the period
to 31 December 2003 not to compete with Audiofina in the business of
television and radio station broadcasting (subject to certain exceptions); IX.
Pearson will be
granted warrants to subscribe for a further 2% of Audiofina shares in the
period to 3 December 2003 at prices ranging from e160
– e180 to maintain its holding above 20% of
Audiofina; X.
Each of the
parties will have certain pre-emption rights over the sale of shares in
Audiofina and, in the event of a sale of a direct or indirect holding of 40% of
Audiofina, that Pearson will have a right to “tag along” (ie sell out to any
purchasers of any such holding on the same terms); and XI.
Pearson will lose
its minority protection, board representation, pre-emption and tag along rights
if its stake in Audiofina fall below 15% (although it may appoint one director
until its holding falls below 10%). It
will also lose such rights on a change of control. CLT-UFA CLT-UFA’s major
business operations are in free-to-air broadcasting, content production and
radio broadcasting. In 1999, it generated earnings before interest and tax of e346 million (including associates) on sales of e3.211
billion (excluding exceptional items.) Free-to-Air Broadcasting CLT-UFA has interests
in 22 television channels, in 11 European countries, which reach over 120 million
viewers per day. In both reach and revenue terms, it is the largest broadcaster
in Europe. In Germany, it owns
RTL TV, holds a 74.8% stake in Vox and also has stakes in RTL 2 (35.9%) and the
children’s channel, Super RTL (50%.) In the UK, it owns a 35% stake in Channel
5, the UK’s fastest growing terrestrial channel. In France, it owns a 42% stake in the M6 Group. M6 is France’s second largest commercial channel
and the group also operates six thematic channels and owns 25% of the pay tv
channel, TPS. Outside of the M6 Group, CLT-UFA has a stake in RTL 9 (35%), a
general entertainment cable channel, and TMC (23.8%), Monte Carlo’s family
channel. In the Netherlands, it owns HMG Group, operating RTL 4, a general entertainment channel, RTL
5, a specialist news channel and Veronica, which is aimed at teenagers and young adults. In Belgium, it has stakes
in RTL TVI (66%), a leading French speaking channel and Club RTL (66%), a
themed channel aimed at the youth market. It also owns RTL Tele Luxembourg, RTL
7 in Poland and has a 49% stake in RTL
Klub in Hungary. It also owns a 5% stake in Premiere, the German pay-tv sports
channel. Content and Rights
Ownership CLT-UFA is a major
producer of television programmes in Germany, producing over 1,000 hours of programming
per year. Its production companies are UFA Productions, Trebitsch Produktion,
Delux Productions and Grundy-UFA, a joint venture with PTV. Its sports rights
company, UFA Sports, owns the broadcast rights for over 300 clubs and 40
national teams. It also has a TV Rights business, which owns a library with
5,500 hours of television programmes and 700 video titles. Radio CLT-UFA is one of
Europe’s leading radio companies, owning stakes in 18 radio channels across
Europe. In Germany, it owns stakes in 2
national radio stations and 5 regional
stations covering Berlin, Hamburg, Cologne and Bavaria. In France, it owns RTL,
a general interest radio station, RTL 2, which is aimed at the 20 – 40 age
range, and Fun Radio, which is aimed at the 20–25 age range. It also owns
stakes in radio stations in the UK (80%), Luxembourg (100%), two stations in
Belgium (43% and 35%), one in the Netherlands (39.5%), two stations in
Scandinavia (49% and 100%) and one in Austria (25.1%). PEARSON
TELEVISION Pearson
Television is one of the leading independent international television
production companies in the world. It has some 160 programmes in production in
35 countries around the world and makes sales from its library of over 10,000
hours of programming to over 100 territories.
It owns an important selection of
game show formats, is the largest producer of serial dramas and makes a
wide range of entertainment programmes, including situation comedies,
children’s animation and action adventures. Its most popular programmes include
Baywatch, The Bill, Salatut Elamat, Skilda Varldar, Gute Zeiten, Schlechte
Zeiten, Verbotene Liebe, Unter Uns, Hinter Gittern, The Price is Right, Family
Feud, Night Fever, 100%, Match Game and Neighbours. It also
owns a 29% stake in the UK’s Channel 5, 20% stakes in RTL Klub in Hungary and
UKTV in Australia and a 7% stake in Uproar.com, one of the world’s leading
online entertainment sites. From its studios in central London, PTV also runs a
transmission business, which transmits 50 channels for broadcasters such as
Flextech, Discovery and Universal. MAJOR SHAREHOLDERS IN THE NEW COMPANY Bertelsmann AG: Bertelsmann ranks among
the world's premiere media enterprises. The company's 72,000 employees generate
some 15 billion euros in revenues in 53 countries. Founded in 1835 as a
Christian publishing company in the State of North Rhine Westphalia's town of
Gütersloh, the firm has evolved to become a full-fledged media and
entertainment business serving the full range of media segments, covering the
book, newspaper, magazine, scientific literature, music, radio, television,
film production and printshop submarkets. Moreover, Bertelsmann provides media
services of all kinds and has established a formidable Internet and e-commerce
presence that is second to none in its peer group. Bertelsmann's characteristic
features are the company's decentralized structure counting over 600 individual
firms, most of which are independent, its policy of internal journalistic
pluralism and its clear commitment to a multiple-brand policy for media
audiences in its various language and cultural regions of activity. The
majority of the company's capital stock is owned by the Bertelsmann Foundation.
Voting rights are held by the administrative body Bertelsmann Verwaltungsgesellschaft
to which post WWII founder, co-owner and benefactor Reinhard Mohn transferred
his voting rights. Groupe Bruxelles Lambert S.A.: Groupe Bruxelles Lambert S.A. is an
investment holding company incorporated in 1953 which has been quoted on the Brussels
Stock Exchange since 15 October 1956.
GBL is controlled by the families Frère and Desmarais through their
respective holding companies. The Group has a market capitalisation of e5.5 billion.
GBL aims to grow a rich and balanced portfolio of industrial
investments, focusing on a small number of first-class companies acting in a
diversified range of sectors, in which GBL can exercise its role as a
professional shareholder. GBL's actual
portfolio includes five long-term investments : CLT-UFA, TotalFina, Suez
Lyonnaise des Eaux, Imerys and Rhodia, held directly or through two
intermediate companies : Electrafina (80.8 %) and Audiofina (72.6 %). Since the
merger of the group CLT and UFA in 1997, GBL has participated, through its
joint venture with Bertelsmann, in the development of CLT-UFA as a major
European broadcasting group. GBL's 50 %
investment in CLT-UFA, through the quoted company Audiofina, represents
presently nearly 50 % of the estimated value of GBL. Pearson plc is an international media company. In 1999, it made operating profits of £549m
on sales of £2,395m. In addition to Pearson Television, its major business
operations are: The Financial Times group, which has an international network
of business and financial newspapers and online services which are read by
millions of business executives and investors every day; Pearson Education, the
world’s leading education business, which helps teachers teach and students learn
at every stage and in every part of the world; The Penguin Group, which is one
of the pre-eminent names in consumer publishing, with an unrivalled range of
fiction and non-fiction, bestsellers and classic titles; and Recoletos, one of
the top media companies in Spain, which is also breaking out into new Spanish
and Portuguese speaking markets. |