Kirch Group buys F1 shares.

As rumoured, Formula One stakeholder EM.TV has sold part of its shareholding to television company Kirch.

The deal was forced on EM.TV boss Thomas Haffa by his company's plunging share price, and sees Kirch take over not just a part of the F1 business, but also a portion of EM.TV itself. The television company runs one of Germany's leading free-to-air channels and is also involved with the national deal to run Bernie Ecclestone's digital grand prix broadcasts.

Rumours that company deputy chairman Dieter Hahn met with Bernie Ecclestone last week led to speculation that Kirch was moving closer to an agreement to bail out the ailing EM.TV, and reports on Britain's FT.com today confirmed that it has absorbed several million Euros of debt as part of the acquisition.

Kirch has taken a stake worth almost 17 per cent of EM.TV in the deal, as well as taking over 49 per cent of its shares in SLEC, Ecclestone's Formula One holding company, valued at $550million. It intends to pay for the stake via a combination of cash and shares in Kirch media, its terrestrial television arm.

The development now appears to cast a cloud over EM.TV's proposed extension of its stake in SLEC, which would have enabled it to acquire a further 25 per cent of the company early next year.

It also adds to the confusion surrounding a possible buy-in by the various major manufacturers involved in the sport. Ferrari, Ford, DaimlerChrysler, Fiat and Renault were all rumoured to be seeking a share in F1, with a view to being able to determine how it is run in the future.

Ecclestone retained 50 per cent of SLEC after EM.TV's purchase, and, critically, retained overall control of the sport as part of the agreement.