Permira, the UK private equity firm whose recent investments include Travelodge and Little Chef, has announced the acquisition of a majority stake in Premiere, the insolvent German pay-television operator. The deal represents the group’s second investment in the space of a week.
Financial details of the transaction were not disclosed, although Premiere’s head, Georg Kofler told Reuters that Permira would inject enough fresh capital to carry the channel to break-even. The channel needed E150 to E200m in funding through to 2004, he said.
Premiere filed for insolvency in May, following the collapse of KirchMedia, the Kirch empire’s free-TV broadcasting and rights unit. A number of buyout houses were also thought to have made a running for the pay-television assets, including Goldman Sachs as well as Apax Partners and Warburg Pincus.
Permira is rumoured to be taking a 70 per cent stake in Premiere in exchange for cash. Premiere’s main creditor banks, Bayerische Landesbank and HypoVereinsbank, are expected to take a 20 per cent stake, while management will hold around 10 per cent of the shares.
The transaction completes a successful end to the year for Permira, following the recent £712m purchase of Travelodge and Little Chef from Compass and its profitable sale of Homebase to Great Universal Stores for £900m. Permira’s other major transaction in 2002 was the E675m take-private of Italian luxury boats manufacturer Ferretti.
The Premiere investment is likely to be made via the E3.5bn Permira Europe II fund. The deal is expected to be completed in the first quarter of 2003. UBS Warburg led the sale process for KirchMedia.