Liberty may help Kirch

December 13, 2001 Posted: 0908 GMT

LONDON (CNN) -- Liberty Media, the U.S. media company controlled by media mogul John Malone, has been in talks to help debt-laden KirchGuppe.

Liberty is considering options to deliver cash to the Munich-based company, the Financial Times said. Liberty chief Malone signalled in November an interest in buying News Corp's stake in Kirch's pay TV business.

Any attempt by Malone to take a stake in Kirch may be opposed by German regulators, who are having trouble passing Liberty's proposed 5.5 billion ($5 billion) purchase of Deutsche Telekom's cable assets.

KirchGruppe is faced with debt problems estimated to be between 4 billion and 7 billion and is now having trouble repaying loans to German banks, a task made more difficult due to slump in advertising.

At the same time, French broadcaster TF1 (PTFI) has held talks with Kirch to buy the German company's 25 stake in Spanish broadcaster Telecinco for about 1 billion marks ($458 million), FT Deutschland said.

KirchGruppe got more breathing room on Wednesday as the German media group said Dresdner Bank had extended a loan it reportedly called in earlier this week. The decision on the extension of the loan, said to be worth 900 million marks, was made in negotiations that lasted into the evening hours of Wednesday, a KirchGruppe spokesman said.

Banking sources told Reuters on Tuesday that Dresdner asked Kirch to pay back the loan by the end of the year, a move that caused worries about Kirch's liquidity.