[eccr] Kirch declares itself insolvent

Kirch declares itself insolvent
-------------------------------
The main unit of the Kirch media empire - owner of the broadcast rights
to the football World Cup - has declared itself insolvent. The
declaration came after attempts by rivals and bankers to salvage the
group as a going concern foundered last week.

Costly film rights deals and a misjudged foray into pay-television
brought the firm to its knees: although the privately held Kirch Group
does not publish full accounts, estimates of its debt start at 6.5bn
euros. 

However, most of Kirch's lucrative sports rights and other assets,
including the World Cup, Formula One racing and popular tabloid Bild,
are held by other subsidiaries, keeping them well away from the claws of
the administrators.

Kirch's Formula One rights are held by its majority-owned SLEC
subsidiary, not included in the insolvent KirchMedia unit, and now
likely to be sold. 

And the firm has already ring-fenced its rights to World Cup coverage in
2002 and 2006, after transferring them to a KirchSport unit in
Switzerland. 

Leo Kirch spent almost half a century building up the group which
controls Germany's biggest commercial broadcaster ProSieben and 40% of
the popular tabloid Bild (also not included in the insolvency
announcement). 

The insolvency of KirchMedia is yet another blow for German business,
which has suffered the failure of a string of well-known corporate names
in recent months, including construction firm Holzmann and stationer
Herlitz.

Source: 
http://news.bbc.co.uk/low/english/business/newsid_1916000/1916490.stm - BBC

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