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RTL has agreed to buy Sky’s German business, reviving the European broadcaster’s attempts to pursue TV consolidation to fend off the threat posed by US streaming giants such as Netflix.
RTL said the acquisition, if approved by EU regulators, would enable it to leapfrog Disney to become the third-biggest provider of streaming services in Germany after Netflix and Amazon Prime.
RTL chief executive Thomas Rabe said the deal would help it to fend off the threat it faces. “I’ve always been convinced that intra-European consolidation is necessary in order to compete with our US rivals,” he told the Financial Times.
Sky Deutschland, which is a wholly owned subsidiary of Comcast-owned Sky, has never made a profit, but Sky executives expect it to break even this year.
Rabe said the tie-up, which includes Sky’s business in Germany, Austria, Switzerland and customer relationships in Luxembourg, Liechtenstein and South Tyrol, could deliver savings on marketing, content and technology worth €250mn within three years.
The deal would see RTL Group pay €150mn in cash to US media group Comcast up front. Comcast also has the possibility of receiving a further payment, in cash or shares, of up to €377mn depending on the share price performance of the partially listed RTL over the coming five years.
Together, the two groups would have 11.5mn subscribers across RTL’s streaming platform RTL+, Sky’s Wow streaming service and Sky paid TV. The tie-up would bring RTL’s annual revenue to about €8bn, compared with €6.9bn in 2024.
Dana Strong, group chief executive at Sky, said: “Sky Deutschland has made significant progress over the past three years. Combining the strength of our brand with RTL builds on that momentum and opens up even greater opportunities.”
Rabe, who is also chief executive of RTL’s largest shareholder, Bertelsmann, has long argued that Europe needed to create “national media champions” with the clout to fight off the threat posed by American streaming groups.
All European commercial broadcasters are facing the challenge of shifting their services from linear to online viewing to meet audience demand and compete with the likes of Netflix, Disney and Amazon.
But Rabe suffered a series of setbacks at the hands of competition authorities. In 2022 he abandoned a proposed tie-up between Bertelsmann’s French network M6 and its larger rival TF1, France’s largest commercial broadcaster, due to strong regulatory opposition. TF1 last week agreed to stream all of its TV channels across Netflix.
A bid by RTL to acquire the Dutch Talpa Network was blocked by the competition watchdog in the Netherlands in 2023. It subsequently agreed to sell its Dutch division to Belgium’s DPG Media in a deal that is still pending regulatory approval.
Rabe said he believed the deal would be approved by regulators at the European Commission because the two broadcasters operated in different market segments.
“We tried in the Netherlands and France and were blocked. But we’ve tried again,” he said.
Strong said Rabe had approached Sky after it won the rights to show four-fifths of German football’s Bundesliga matches exclusively last year.
“The calibre of the rights that we acquired out of the Bundesliga auction spurred them into action,” she said, adding that it would not have any “read across to the other markets” where Sky operates, such as the UK, Ireland and Italy.
“This was a unique opportunity in a unique market, creating a very powerful German-language streaming proposition.”
