By Elvira Pollina
MILAN (Reuters) - MFE-MediaForEurope, the top investor in ProSiebenSat.1, said it was focused on helping to improve the performance of the German group which dented its earnings last year.
MFE, controlled by Italy's Berlusconi family, holds a nearly 30% stake in ProSieben.
It has called for changes at the Bavarian-based broadcaster, including a spin-off or a sale of its digital business and the appointment of two alternative candidates to the group's supervisory board.
"We deem ProSieben a long-term investment and we are focused on the performance on our investment," MFE Chief Financial Officer Marco Giordani told analysts during a post results conference call.
"Our message to (ProSieben) management is to act quickly in order avoid further loss to shareholders," said Giordani adding ProSieben's dividend cut and a writedown of its programming asset caused a combined 50 million euro ($53.4 million) hit on MFE's earnings in 2023.
Despite the hit, MFE reported a 7.9% rise in its operating profit, which rose to 302 million euros last year, helped by strong advertising sales in its main Italian market which offset a revenue decline from its Spanish TV operations.
MFE B-shares rose as much as 9% as the company anticipated a 6% rise in total advertising sales in the first quarter and guided for positive cash generation and operating profit for the current year.
TAKEOVER TALK
Giordani dismissed the idea MFE is interested in launching a takeover offer for ProSieben now, noting that it did not make a move three months ago, when the stock was trading at 5.5 euros compared to the current price of 7.3 euros.
Reuters reported this week that MFE held talks with various banks between late last year and the beginning of 2024, with lenders ready to finance a bid of up to 4 billion euros.
Giordani cited ProSieben's high debt level and uncertainties over the value of digital businesses as the main reasons for such a stance. Shares in ProSieben fell by nearly 7% on Thursday.
ProSieben declined to comment on Giordani's remarks.
MFE has repeatedly called on ProSieben to join its project to create a pan-European TV champion, but the German group has pursued a standalone strategy.
ProSiebenSat.1 shareholders will vote on MFE's proposed changes on April 30. They were strongly rejected by ProSieben as not in the best interest of the company's investors.
Under MFE's proposals, ProSieben would be forced to study an asset split, which could eventually materialise next year following another shareholder vote.
Giordani said MFE has made such a move to speed up the disposal of the German broadcaster's e-commerce and online dating operations, refocus on the core TV business and cut debt as part of a long-awaited revamp.
($1 = 0.9371 euros)