Published by Global Banking and Finance Review
Posted on June 27, 2025
By Klaus Lauer
BERLIN (Reuters) -European broadcaster RTL Group said on Friday it would buy Sky Deutschland, in a deal that combines Sky's sports and streaming offerings with RTL's news and entertainment brands to create a business with 11.5 million paying subscribers.
Shares in RTL surged 12% following announcement of the deal, rising to the top of Germany's mid-cap index.
The merger brings together two of Europe's strongest media offerings in sport and entertainment in a battle to catch up with U.S. heavyweights in Germany.
RTL and Sky's combined streaming services boast an audience larger than that of Disney but far behind market leaders Netflix and Amazon Prime.
The deal includes a 150 million euro ($176 million) upfront payment plus a variable component of up to 377 million euros depending on RTL's share price which Sky parent Comcast can trigger any time within five years.
The purchase gives RTL, which is majority-owned by German media group Bertelsmann, local access to Sky's premium sports rights including Bundesliga and Premier League soccer, and Formula 1 motor racing, as well as Sky's WOW streaming service.
A person familiar with the situation said RTL had approached Sky for the deal, and that Sky was not looking to sell any other part of its business.
RTL Chief Executive Thomas Rabe described the deal as "transformational" for the group and said it would create cost savings of around 250 million euros per year within three years of the deal closing.
In the past, Rabe had considered a bid for German competitor ProSiebenSat.1 but doubted whether competition regulators would give that the green light.
He told Reuters in a separate interview that RTL would not be involved in any further consolidation in the German market.
"The issue of a merger with ProSiebenSat.1 is now definitely off the table," he said.
ProSieben, for its part, is trying to fend off a takeover from MFE, the TV broadcaster controlled by Italy's Berlusconi family, which wants to build on its commercial TV operations in Italy and Spain to create a pan-European broadcaster.
Sky Deutschland, which operates in Germany, Austria, Switzerland, was on track to break even on an earnings before interest, taxes, depreciation and amortization (EBITDA) basis, Sky Group Chief Executive Dana Strong said.
The business reported around 2 billion euros in annual revenue.
The variable component of the deal with Sky depends on RTL's share price, which was 35.40 euros at 0721 GMT in Frankfurt trade following a jump in value after announcement of the deal.
Comcast can trigger it at any time within five years of the deal being finalised provided the share price exceeds 41 euros.
At a share price of 70 euros, the additional payment for Comcast would be capped at 377 million euros. RTL can pay in cash, shares or a combination of both.
($1 = 0.8519 euros)
(Reporting by Klaus Lauer in Berlin and Kate Holton in London. Writing by Sachin Ravikumar and Rachel More. Editing by Mark Potter, William James and David Evans)
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