Channel 5 broadcaster delays plans for full listing

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The Independent Online

RTL, Europe's largest broadcaster, is likely to miss a second self-imposed deadline to obtain a full listing on the Stock Exchange, sources close to the company said. That means the group will remain ineligible for inclusion for the FTSE 100 index.

The company, which owns 65 per cent of Channel Five, originally pledged to issue sufficient shares to ensure a 15 per cent float on the stock market, the minimum amount necessary for FTSE 100 status, within 12 months of its merger with Pearson Television in April last year. Earlier this year, Didier Bellens, chief executive of RTL, pushed the deadline back, but said the full float would occur by September.

However, it is now thought that the company's mostly German board of directors are reluctant to issue stock given the severe slump in advertising spending and the consequent depressed valuations of media companies. Sources said that a move to gain a full listing in London is likely to be postponed indefinitely.

RTL is majority owned by Bertelsmann, the privately-held German media giant, which owns Random House, the US publishing company, BMG Music and BOL, the online bookseller. Pearson injected its television arm including a stake in Channel Five and its programme production operations into RTL in return for a 22 per cent interest in the enlarged group.

Though Pearson television was one of Britain's largest programme makers, Marjorie Scardino, the parent company's chief executive, believed it was too small to achieve the scale necessary to compete with bigger US and European players. Delay in RTL achieving the full listing in London will make it more difficult for Pearson to gradually reduce its stake in the Luxembourg-headquartered broadcaster.

Currently, about 12 per cent of RTL's shares, which have lost half their value in the past 18 months, are freely floated in Brussels. Though the company has a London listing, the stock is denominated in euros and suffers from a severe lack of liquidity.

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