January 31, 2013 / 7:06 PM / 5 years ago

UPDATE 1-Bertelsmann mulls cutting RTL stake to finance growth

* Bertelsmann holds 92.3 pct of RTL voting rights

* Intends to retain a stake of about 75 pct

* RTL Group current market value is 11.7 billion euros

FRANKFURT, Jan 31 (Reuters) - Bertelsmann is considering a reduction in its stake in Europe’s largest broadcasting group, RTL Group, to raise money for an overhaul of its business to catch up with fast changing markets.

Bertelsmann, which currently holds 92.3 per cent of the voting rights in RTL said on Thursday it was thinking of shrinking its shareholding in RTL through a capital market transaction but would retain about 75 percent.

“Bertelsmann is currently considering various options to finance its growth ambitions,” Bertelsmann’s Chief Executive Thomas Rabe said in a statement.

“Bertelsmann would retain a significant majority stake of around 75 percent of RTL Group,” he added.

Bertelsmann is in the middle of an overhaul, trying to grow faster by becoming more digital and international.

Europe’s biggest media group in October agreed with Britain’s Pearson to merge their publishers Penguin and Random House, aiming to gain the upper hand in their relationship with Amazon and Apple, the leaders in the ebook revolution.

Last year Bertelsmann changed its legal form from a joint stock company to one allowing it to list as a company controlled by a family holding.

Luxembourg listed RTL Group currently has a market capitalisation of 11.7 billion euros ($15.9 billion), according to Thomson Reuters data.

The group said in a separate statement that it “understands that a final decision will depend on a number of conditions precedent, including a favourable capital market environment.”

“RTL Group will review options to increase the efficiency of its capital structure, such as a potential payment of an extraordinary dividend,” it added.

Bertelsmann also said on Thursday its 2012 revenue increased 5 percent to around 16 billion euros, while earnings before interest and taxes (EBIT), excluding special items was flat at 1.7 billion euros.

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