German media conglomerate Bertelsmann, owner of RTL Group, is planning acquisitions of US companies as US-based revenues become increasingly important for the business. The US became Bertelsmann’s largest sales contributor for the first time in H1 this year, making up 28.4 percent of total revenues, and CEO Thomas Rabe told Reuters that there will “definitely be further acquisitions in the US”. Bertelsmann will look at potential acquisitions across its US businesses, looking at both small and medium-sized companies.
While Bertelsmann’s TV business is European-based, its content arm – which helps fuel its TV business – has US-based elements. Bertelsmann also owns ad tech investments through its investment arm, which again has business in the US. Either of these areas could be targets for further US-based acquisitions.
Championing its champions
Bertelsmann has a fairly diversified corporation – alongside its broadcasting and content divisions, it also owns book publisher Penguin Random House, education businesses, and logistics businesses among others. But its media offering still sits at the core of the business, as RTL Group, its single largest holding, makes up over a third of total revenues.
In response to the challenges facing the TV market, Bertelsmann’s strategy has been to create ‘national media champions’. Bertelsmann’s investments in content play a part here too, through directly creating content and providing access to IP which can fuel its TV holdings.
Thomas Rabe says that the company is making progress with its national media champions strategy. Across the group, Bertelsmann has committed to accelerating growth through investing in its existing businesses, and Bertelsmann sees continued investment as key in order to establish national media champions. The company says it has maintained high levels of investment in content, the expansion of its streaming business, tech, and data.
This investment powered the launch of M6+ in France earlier this year, replacing M6’s older streaming offering 6play, which has in turn driven significant growth in M6’s streaming audience (up 66 percent year-on-year in terms of hours viewed, according to recent data from M6. It has also funded RTL Deutschland’s continued acquisition of major sports rights. RTL held rights to this summer’s men’s Euros, which brought in high viewing figures, and has also secured rights to the 2026 and 2030 FIFA World Cups. Bertelsmann has also invested in distribution partnerships between RTL Deutschland and Deutsche Telekom and Sky Deutschland, which it says will strengthen its position against the global tech platforms.
Restrained by antitrust
The question for Bertelsmann is whether these investments will be enough in the long term to maintain growth in its TV business. Revenues for RTL Group were up year-on-year in H1, thanks to a recovery in the ad market, but this was growth in comparison to a relatively weak H1 last year.
Bertelsmann hasn’t been able to pursue its ‘national media champions’ strategy as aggressively as it might have liked, partly constrained by antitrust concerns. Rabe has previously said that RTL Deutschland should be allowed to merge with local rival ProSiebenSat.1, acknowledging that such a move would be unlikely in the current regulatory landscape. Plans to sell M6 to fellow French broadcaster TF1 fell through due to intervention from France’s competition authority. As such, Bertelsmann has had to settle for trying to grow its existing TV businesses organically, while also fostering cooperation within markets where possible.
