European broadcast group RTL is leaving Greece’s television market, after deciding to sell its majority stake in its local subsidiary Alpha Media Group.
RTL today said it will sell its 70% share in Alpha to Greek entrepreneur Dimitris Contominas, who already owns the remaining 30% and stands to become the sole owner of the company.
The sale will be subject to approval from the Greek Competition Commission but it is expected to be closed during the first quarter of this year. Financial terms were not disclosed.
Alpha is made up of national television channel Alpha TV and in-house prodco Plus Productions.
The sale will not affect the current management, which will continue to operate the channel, according to the companies.
RTL Group CEO Gerhard Zeiler said the ongoing financial crisis in Greece meant the company could no longer sustain its position in the market.
In its financial results for the first half of 2011, released in August last year, RTL withheld figures about Alpha but noted that the Greek TV ad market had shrunk by 29.3% year-on-year.
Zeiler said today: “While we cannot influence the overall market development, our local management team led by CEO Christoph Mainusch, together with Alpha’s employees, succeeded in increasing the channel’s ratings and cutting programme costs at the same time – both to a substantial extent.
“We are happy to have found a solution that enables Alpha to continue broadcasting.”
RTL acquired a majority stake in Alpha in December 2008. But Greece’s calamitous financial climate has led to the ad market shrinking by 50% since that time. This forced RTL to cut costs by about 45% between 2008 and 2011 to compensate for falling revenue.
Overall, RTL’s profits increased in the first half of 2011, with net profit up 26.1% to €324m (US$414m) for the six months to June 30, compared with €257m in 2010. Revenues for the same period 3.4% to €2.75bn from €2.66bn.
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