THOMAS MIDDELHOFF: COME ON DOWN!
Following Bertelsmann AG’s sale of all but .7% of its remaining stake in AOL Europe and AOL Australia, which took place last Friday (3/17), the German media conglomerate will add another $8 billion-plus to its substantial coffers, and Chairman Thomas Middelhoff is going on a shopping expedition.
"Together with the possible proceeds fromthe sale of stakes in AOL Inc., we can reach around 18 billion marks. Because from that we can also bet on other capital, we have the possibility to go shopping with around 75 billion marks," Middlehoff told German newspaper Welt am Sonntag. "And shopping is much less stressful than military conquest. Or so I hear."
Middelhoff's remarks were much funnier in the original German.
While that amount, which converts to just over $37.5 billion U.S., won’t begin to cover the cost of a Time Warner-level purchase, it ain’t chopped liver, and Middelhoff hopes to score a prize in either the music or publishing area. At today's prices, that amount will keep an online music company from going Chapter 11 for nearly four months.
According to Middelhoff, some of the money will be used to beef up Bertelsmann’s e-commerce and online content undertakings. Bertelsmann will continue to provide content for AOL, providing the Germans with an estimated $250 million by 2004. Middelhoff hopes to surpass Amazon.com in the e-commerce biz within five years. More information is available via AOL keyword "schnitzel."
AOL will pay Bertelsmann in either cash or stock after January 31, 2002.
"If we need money earlier, we’ll mortgage our option," said Middelhoff, citing opportunities to pick up newspapers in the U.S. as well as solidifying Bertelsmann’s status as Europe’s #1 TV broadcasting entity. He also pointed to holes in the company’s book publishing holdings around the world.
In related news, BOL International AG (BOL is short for Bertelsmann Online) plans to float a 20-25% stake in its IPO, planned for the second quarter on the Frankfurt exchange.
