BSkyB Expected to Buy Premiere World Stake


Frankfurt, Germany -- Rupert Murdoch appears to have
succeeded in securing a major foothold in Germany.

News Corp.'s 40-percent owned British Sky Broadcasting
Group plc last week agreed to take a 25 percent stake in German digital pay TV platform
Premiere World, according to local news reports.

At press time last Tuesday, Kirch managers were expected to
head to London to discuss the remaining issues, reports said, with final contracts
expected to be signed by Friday. Neither company could be reached for comment.

The deal would be BSkyB's first beyond the United
Kingdom. For Kirch Group, which owns 95 percent of Premiere World, it would provide about
2 billion deutsche marks ($1.03 billion) in cash and BSkyB shares to fund its digital
project, the reports said.

Prior to reports of the deal with BSkyB, Kirch announced
that it secured funding from a group of banks. Chase Manhattan Bank granted a 1.5 billion
deutsche mark ($770 million) bridge loan to its KirchPayTV KG unit, in which the company
groups its pay TV activities. A similar loan was granted by a cluster of mostly German

German general interest channel tm3, which is 68 percent
owned by News Corp., has also applied with local authorities for a license to launch six
digital special-interest channels. Included in this bouquet would be a pay-per-view
service to transmit soccer games from Europe's Champions League, to which tm3 has
acquired rights.

Kirch would need those rights to make its Sports World
package more attractive to consumers. It is not yet clear how BSkyB's investment in
Premiere World will affect tm3. Analysts speculated that the service could become a sort
of stand-alone bouquet, available only to Premiere World's digital subscribers.

The platform has more than 2 million subscribers, about
half of which receive digital signals. Last month it added 110,000 subscribers.