Italy's Mediaset, ProSiebenSat.1 deny merger talks

MILAN (Reuters) - Italian media group Mediaset and its German rival ProSiebenSat.1 Media denied a media report on Saturday that they were in merger talks.

FILE PHOTO: The Mediaset tower is seen in Cologno Monzese neighbourhood Milan, Italy, in this April 7, 2016 file photo. REUTERS/Stefano Rellandini/File Photo

Earlier on Saturday daily newspaper Il Sole 24 Ore said the two companies were in talks to merge via a share exchange to create a pan-European independent broadcaster.

“No talks are being held for a merger with German TV group Prosiebensat1 Media,” Mediaset said in a statement.

Max Conze, ProSiebenSat1 CEO, also denied talks.

“I see no industrial logic in combining,” he said in an emailed statement.

Conze said the company was working with peers, including Mediaset, as part of an existing European media alliance, a network of 12 broadcasters that aims to cooperate on streaming and advertising technology.

Like other broadcasters, ProSiebenSat.1 faces competition for viewers from online content providers like Netflix that dents TV advertising, which still contributes nearly half of its revenue.

Italy’s biggest commercial broadcaster has repeatedly raised the idea of creating a pan-European TV player to fend off competition from established rivals and new entrants.

Asked whether Mediaset could tie up with “the Germans”, Mediaset Chairman Fedele Confalonieri said this month a cross-border deal was still being studied, lifting ProSiebenSat.1 shares.

The Munich-based group’s shares are trading near a seven-year low, prompting speculation that cash-rich private equity buyers could be tempted to break up the company.

Reporting by Giulio Piovaccari; Editing by Jan Harvey