Approaching Division of Springer and KKR Appears to Be Inevitable
It's been revealed that KKR, a U.S. financial investor, and Mathias Döpfner, the CEO of Springer and a significant shareholder, are reportedly close to finalizing a split agreement for the media conglomerate. As per a source, this decision was made during the summer. There might be an official announcement coming up next week.
However, the actual signing of the deal could take a few more months, according to reports. Upon completion, KKR and the Canadian pension fund CPPIB are said to be leaving the media sector. In exchange, KKR will gain majority control over the classifieds business. Döpfner, the widow of publisher Friede Springer, and her family will retain a minor stake. A Springer spokesperson chose not to comment, while statements from the other involved parties were also unavailable.
The Financial Times first reported this, based on information from four sources. The supervisory board is set to deliberate on the proposed terms of the deal this Thursday. Previous discussions about the deal have taken place in multiple supervisory board meetings, two of the FT sources mentioned. The entire company is estimated to be worth 13.5 billion euros, with the classifieds business valued over 10 billion euros, according to the report. However, these figures are not yet final.
Back in 2019, KKR invested in Springer and removed the company from the stock market after a 35-year run. Springer's media operations encompass newspapers like Bild and Welt, as well as U.S. media outlets such as Politico and Business Insider. KKR fostered growth through financial investments. This takeover was Springer's largest ever.
Rumors have been circulating in the industry that KKR is exploring options to divest from its stake. Currently, KKR holds 35.6%, and CPPIB holds 12.9%. If funds are made available due to the deal, it's expected that the majority will be channelled towards the U.S. market, with less going towards Germany's media sector, according to sources from July.
After the deal's completion, the Canadian pension fund CPPIB, along with KKR, will exit the media sector, focusing their attention on other areas. Interestingly, Springer's operations extend beyond Canada, with notable media outlets such as Bild and Welt based in Canada.
