Group DPG Media Acquires RTL Nederland for €1.1 Billion from RTL Group
Last Friday, the share price of RTL stock jumped an impressive 3.6%. The reason for this surge was a press release from the TV company announcing that it would be selling its Dutch subsidiary RTL Nederland to Belgian competitor DPG Media for 1.1 billion euros in cash.
Originally, the RTL Group had intended to merge its Dutch subsidiary with John de Mol’s media company Talpa Network in order to compete with the emerging international streaming services. However, the merger fell through in the spring of 2023 due to a veto from the Dutch competition authority ACM.
But before I go into further details of the acquisition deal, I’d like to introduce you to the companies involved in a brief portrait.
A brief portrait of the companies involved The RTL Group S.A is an international media company founded in Luxembourg in 1924. The company operates numerous TV and radio stations in Germany, France, and other European countries. In addition, the RTL Group runs streaming services and markets content.
The media company listed on the Luxembourg and Frankfurt Stock Exchanges is included in the MDAX. RTL is majority-owned by Gütersloher Bertelsmann SE & Co. KGaA. The well over 17,200 RTL employees generated a turnover of 7.22 billion euros and an operating profit (EBIT) of 972 million euros in 2022.
RTL Nederland operates the leading TV station family in the Netherlands with 5 free-TV channels (RTL 4, RTL 5, RTL 7, RTL 8 and RTL Z), 3 digital pay-TV channels (RTL Lounge, RTL Crime, RTL Telekids) as well as an independent news agency.
With 1.3 million paying subscribers, Videoland, the streaming service operated by RTL Nederland, is the leading national streaming service in the Netherlands. In the 2022 financial year, RTL Nederland generated a total turnover of 636 million euros.
DPG Media is a media company with leading brands in the areas of news media, TV (VTM), radio, magazines, newspapers, and online services.
The media company is active in Belgium, the Netherlands, and Denmark.
The company founded in 1999 is headquartered in Asse-Kobbegem (15 km northwest of Brussels) and is privately owned. In 2021, DPG Media already acquired RTL Belgium for 250 million euros together with the Brussels publishing group Rossel.
In 2022, the nearly 5,400 DPG employees generated a turnover of 1.77 billion euros and an earnings before interest, taxes, depreciation, and amortization (EBITDA) of 339 million euros.
Further details of the acquisition According to the RTL Group, the divestment gain is expected to be around 800 million euros and should be largely tax-free. The shareholders of the RTL Group will also benefit from this gain within the defined dividend policy.
As part of the sale agreement, the RTL Group and DPG Media have agreed on a strategic partnership in the areas of technology, advertising, and content.
How it should continue After the sale of RTL Nederland, the RTL Group will remain active in the Netherlands with its production subsidiary Fremantle, which has developed casting shows such as Got Talent (with the German version Supertalent) and Pop Idol (Deutschland sucht den Superstar).
The transaction is subject to the approval of the regulatory authorities and the information and consultation processes with the respective employee representatives, according to RTL. The closing is expected to take place in the middle of 2024.