The Kirch group is expected to unveil plans to restructure Premiereworld, its loss-making pay-TV division.
Premiereworld has cost Kirch billions of Euros and has seen a succession of chief executives. Today it is the turn of Georg Kofler, who was drafted in only a few months ago, to present to shareholders who include News Corp with 22%. Analysts estimate that Premiereworld, which has some two million subscribers, will run out of cash by September.
Premiereworld is losing some Euros2m a day and is expected to need a cash injection of at least Euros500m. It has already announced plans to lay off 250 of its 2,400 staff.
Kirch met again on Sunday with its bankers to discuss debt restructuring plans for the sprawling group. The top-level meetings, which began ten days ago and may continue until the end of April, concern only its bank debts. While financial weekly Focus magazine and the Kirch-hired reorganisation expert Wolfgang van Betteray this week put Kirch's debts at Euros 6.9bn and one banking source cited by the Wall Street Journal estimated that the group owes Euros 8bn to the banks, the company insists that it owes a slightly more modest figure. "We have said we have debt of 6.5 billion euros and have maintained transparency regarding this," said company spokesman Hartmut Schultz.
But the group also has other trade obligations including a "put option" held by former partner Axel Springer Verlag, another option held by News Corp, which would force Kirch to buy back its shares in Premiere for Euros 1.7bn, and debts to the Hollywood studios incurred on films Premiere has acquired.
There has been recent speculation that its trade creditors might be prepared to take stakes in free-TV operation ProSiebenSAT1 and that manoeuvring may eventually deliver Premiere into the hands of Rupert Murdoch. It seems more certain that Kirch will lose its stake in the business that runs Formula One motor racing.