German giants talk $16bn merger

German broadcaster ProSiebenSat.1 and publishing powerhouse Axel Springer are reportedly in merger talks to create a €14.4bn (US$16bn) media company.

The negotiations are at an early stage and the merger would face regulatory challenges, according to reports in The Wall Street Journal and local paper Frankfurter Allgemeine Zeitung.

Springer moved to buy ProSieben 10 years it ago but was thwarted by Germany’s media watchdog KEK and the country’s anti-trust body.

But since then US streaming giants such as Netflix and Amazon, as well as a raft of local players, have entered the German TV market, putting significant pressure on traditional broadcasters.

ProSieben is Germany’s biggest commercial broadcaster, while Axel Springer is the country’s biggest news publisher, owning titles such as Europe’s best-selling tabloid, Bild. ProSieben is the larger company with a market worth of around €9.7bn, while Axel Springer is valued at around €4.7bn.

Both companies declined to comment.

Last month, Talpa Media, now part of the UK’s ITV, acquired the 50.1% of prodco Talpa Germany (fka Schwartzkopff TV) that it did not already own from Springer.

UPDATE – Axel Springer has issued a statement saying any reports it will relinquish control of its business are “completely unfounded”.

The company said majority shareholder Friede Springer will retain control. The firm said it was sticking with plans to change its legal structure which would allow the Springer family to retain control of the group even if its stake falls below 50%.

It did not comment specifically, or deny, rumours of a union with ProSiebenSat.1.