FRANKFURT—German publisher Axel Springer SE and broadcaster
ProSiebenSat.1 Media AG said they are working on a joint project to
promote digital startups but aren't pursuing a tie-up beyond
that.
ProSiebenSat.1 and Axel Springer on Wednesday said they plan
jointly to promote innovative digital business ideas and startups
to enhance the positioning of Germany as a digital hub.
Joint investments in companies and funds, networking of
incubator and accelerator programs as well as media for equity
investments are planned, they said.
The Wall Street Journal had reported earlier this month that the
two companies were in broader talks to combine their businesses.
Those discussions, however, faced high hurdles and eventually broke
down.
People familiar with the matter pointed to differences over the
potential shareholder structure for a combined Springer and
ProSieben company. ProSieben's market capitalization of around 10
billion euros ($11.06 billion) would make it the senior partner in
a combination with Springer, which is about half as large.
In a reaction to the Journal story, however, Springer said its
majority shareholder Friede Springer aimed to keep control over the
company in any case. That statement was important because it means
the widow of company founder Axel Springer would need to be granted
special controlling power over a merged entity to still exert
controlling influence.
In a tie-up scenario, her stake would have shrunk from almost
60% in Springer to below 20% in the merged company. Granting Ms.
Springer special controlling power in such a situation, would
hardly have been compelling for ProSieben shareholders, industry
experts have said.
Write to Eyk Henning at eyk.henning@wsj.com
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