Muppets bought back from ailing German owners

After three troubled years as a German, Miss Piggy, the grande dame of puppetry who never lost her original accent, has won back her US passport.

In a cut-price transatlantic deal the family of the Muppets creator, Jim Henson, have bought back Kermit the Frog, Gonzo et al from the debt-ridden German television company EM.TV, which acquired them in 2000.

Brian Henson, son of Jim Henson, said the purchase would help make "the world a better place by inspiring people to celebrate life". He added: "Our commitment as the Jim Henson Company's new owners and as Jim Henson's children is to preserve and enhance those assets, fully realise that potential, and thereby honour our father's legacy."

EM.TV bought the ailing Jim Henson Company for $680m three years ago, but struggled to cope financially after it decided to expand beyond children's films and picked up the rights to Formula One racing. It also became embroiled in a scandal in which its founder and his brother were fined last month for misleading shareholders.

Mr Henson's five children have bought the company back for $89m, which includes the rights to The Muppet Babies and The Fraggles as well as other successful puppetry creations. However, the deal does not include the Sesame Street characters Elmo and Big Bird, because EM.TV sold them in 2000.

Jim Henson, who died in 1990, first worked in television in 1954, but his most successful creation, The Muppet Show, was not broadcast until 1976. It reached nearly 250 million viewers every week in more than 100 countries and won three Emmys during its five-year run. Because of its popularity, major celebrities agreed to appear on the show where they would swap banter with the puppets and be abused by the two ageing critics, Statler and Waldorf.

Such was the long-lasting appeal of Kermit the Frog – created originally from an old coat and a couple of ping-pong balls – that he featured in the Queen's golden jubilee celebrations and was given a star on Hollywood's Walk of Fame. He also addressed the Oxford Union and sang a duet with Kylie Minogue.

In a letter to employees, Charlie Rivkin, chief executive of the Jim Henson Company, said: "Like many of you, I had the privilege of working closely with Jim Henson, and like many of you, I know how pleased Jim would be to hear this wonderful news.

"As we finally end this long, sometimes painful, but ultimately happy chapter of the Muppet story, I want to thank every one of you for believing in the dream."