RTL Group, a leading international commercial broadcasting company, has announced its agreement to acquire German pay-TV broadcaster Sky Deutschland. The deal is valued at approximately €150 million ($175.6 million) and is subject to regulatory approval.
The acquisition will result in a merger of the two businesses, creating a unified brand with around 11.5 million paying subscribers. This move came after RTL approached Sky Deutschland when the latter secured rights to multiple packages of matches from Bundesliga, Germany's top-tier soccer league.
Sky's new deal for Bundesliga covers the next four seasons through 2028-29. The acquisition by RTL will see Sky's premium sports rights stable – which includes not only Bundesliga but also English Premier League and Formula 1 motor racing – merged with RTL's entertainment and news brands.
Largest transaction for RTL Group
This purchase represents the largest transaction for the RTL Group since its inception in 2000. As part of this acquisition, RTL will also use the Sky brand moving forward.
Sky Deutschland primarily operates in Germany, Austria, and Switzerland but also serves customers in Luxembourg, Liechtenstein, and South Tyrol province of Italy. Its programming includes live sports coverage alongside exclusive series, films children's content documentaries and shows.
Thomas Rabe, RTL Group's chief executive, said:
“It will bring together two of the most powerful entertainment and sports brands in Europe and create a unique video proposition across free TV, pay TV, and streaming.
“Together, RTL and Sky will be in an even stronger position to invest in people, content and technology in Germany and in Europe to compete with the global tech and streaming players.”
Deal closure expected next year
While subject to regulatory approval first, it is expected that this deal will close next year. In addition to an upfront payment of €150 million sum by RTL group as part of this agreement there are provisions for additional payments within five years if certain conditions are met.
Specifically if at any point within five years post-deal closure if RTL Group's share price exceeds €41 then Sky can trigger an additional payment capped at €70 per share or €377 million total.
This landmark deal between two major players in European broadcasting promises significant changes not only for the companies involved but also for their millions of subscribers. It will be interesting to see how this merger shapes the future landscape of sports broadcasting and entertainment in Europe.
