RTL has agreed to buy Comcast’s Sky Deutschland for €150 million as the media conglomerate seeks to stave off competition from US streaming platforms.
On top of the €150mn upfront cost, the group may pay a further €377mn if RTL’s share price rises above €41 apiece five years after the deal’s close.
RTL said that the acquisition, if approved by regulators, would allow it to become the third-biggest provider of streaming services in Germany after Netflix and Amazon Prime. The deal is expected to close next year.
Comcast, Sky’s parent firm since 2018, has been looking to sell Sky Deutschland for several years. The German subsidiary has never made a profit but it is expected to break even this year.
The firm has notably been struggling as competition from streaming services heats up. However, Sky won a significant deal to exclusively show most Bundesliga football matches last year, through to the end of the 2028-29 season, boosting its attractiveness.
“The business is on track to achieve EBITDA break-even, reflecting the success of our turnaround plan. Combining the strength of our brand with RTL builds on that momentum and opens up even greater opportunities,” Dana Strong, Group CEO at Sky, said in a statement.
Thomas Rabe, CEO of RTL, noted: “the synergies are estimated to be around €250mn per annum within three years after closing, creating significant shareholder value”.
Combined, the groups will have around 11.5mn subscribers. Under the terms of the deal, RTL will have the right to use the Sky brand in Germany, Austria, Switzerland, Luxembourg, Liechtenstein and South Tyrol.
RTL has been looking to secure new revenue streams through premium subscriptions, as it operates several television and radio stations that are free to air.
The decision to buy Sky Deutschland is the biggest deal it has struck since it was formed in 2000.
In 2023, RTL had its eyes on another consolidation project, bidding to acquire Dutch media conglomerate Talpa Network.
Competition authorities said the merged group would be too dominant in the Netherlands. RTL then proposed to sell its Dutch subsidiary RTL Nederland to Belgium-based DPG Media, although regulators have yet to give the green light.
