BSkyB to run Kirch pay-TV unit in proposed Murdoch rescue plan

Claire Billings,

April 22, 2002

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BSkyB to run Kirch pay-TV unit in proposed Murdoch rescue plan

LONDON - News Corporation chairman Rupert Murdoch is believed to have tabled a rescue package for German media giant Kirch's loss-making pay-TV unit Premiere World, which would see it run by UK broadcaster BSkyB.

As part of the deal, News Corp would inject cash into BSkyB, which would be awarded a management contract to run Premiere, while News Corp would carry the financial risk on its balance sheet.

Such a deal would ease concerns that BSkyB would be used by Murdoch to buy the German pay-TV operation, after BSkyB chief executive Tony Ball's promise to the City that it would not invest any more money in the loss-making business.

BSkyB already owns a 22% stake in Premiere, but wrote off £1bn relating to the stake at the beginning of the year when the extent of the German company's financial woes were revealed.

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