Executives at Germany's beleaguered rights trader and merchandising concern EM.TV have played down wide-spread reports that talks with media concern the KirchGroup are on the rocks.

EM.TV spokesman Michael Birnbaum was quoted by Financial Times Deutschland as saying that there were "no problems which do not overstep the normal level". He told Reuters on Tuesday morning that EM.TV had received a fax from the KirchGroup on Monday afternoon "that they want to continue negotiating".

But sources close to the negotiations noted that there "are still a shortage of decisions on the side of the EM.TV board and supervisory board which are necessary for a successful conclusion". Private media fund Victory MediaManagement may also renegotiate a co-production agreement with EM.TV which was sealed at the end of 1999. The $241m pact envisages the production of 100 animation series with a total production volume of $723m over the next five years.

Victory board chairman Franz Lederer confirmed that Victory has only paid up $12m of the first $48.2m due to EM.TV from an animation fund placed by Victory in 2000. "First of all, we now need clarity", he told business daily Handelsblatt, "then we will make a decision about investments".

The picture was further complicated by speculation that EM.TV might be holding out for another bidder who could submit a better offer than Kirch, although the two sides had agreed in December that negotiations would be exclusive. The talks are not expected to be concluded until the end of January at the earliest, with a date in February more likely.