Document Could Shed New Light on Kirch, Deutsche Bank Case - Report

A recently discovered document could affect the legal proceedings of the Kirch Media Group against Deutsche Bank AG (DB), Frankfurter Allgemeine Zeitung newspaper reported in a preview of its Tuesday edition.

Kirch and Deutsche Bank have been in a decadelong legal battle involving civil and criminal proceedings. Heirs to former German media mogul Leo Kirch claim Deutsche Bank bears some of the blame for its 2002 insolvency due to interview comments made by then Deutsche Bank chief executive, Rolf Breuer. Kirch is demanding billions of euros in compensation. A Munich appeals court ruled in December that Deutsche Bank bears some liability for the insolvency but has yet to set compensation.

According to the newspaper, a transcript of an Axel Springer AG (SPR.XE) supervisory board meeting from Jan. 14, 2002, shows that there were serious concerns about Kirch's creditworthiness even before Mr. Breuer publicly raised doubts about it.

The newspaper reported that, according to the transcript, then Springer chief executive, Mathias Doepfner, said at the meeting lenders wouldn't likely give the Kirch company further funds. Mr. Kirch attended the meeting.

Mr. Doepfner also said that Kirch could go insolvent, were Springer to exercise an existing option to sell a stake in commercial broadcaster ProSiebenSat.1 Media AG (PSM.XE) back to Kirch, according to Frankfurter Allgemeine Zeitung. Nonetheless, the meeting decided that Kirch had to buy back the stake for 767 million euro ($1.03 billion), the paper reported. Kirch didn't support that decision, according to FAZ.

However, a Kirch spokesman said the information isn't new.

"The Munich court made it unmistakably clear that the former Kirch group could still have been restructured, but that was thwarted by Deutsche Bank," the Kirch spokesman said.

A Springer spokeswoman and Deutsche Bank spokesman declined to comment on the report.

Newspaper website: http://www.faz.net

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