Hahn wins Constantin power play but legal issues and fraud probes loom

By Paul Nicholson

November 15 – Dieter Hahn (pictured), the controversial and secretive boss of German media corporation Constantin Media and a key figure behind the scenes in the alleged cash for votes scandal around the Germany 2006 World Cup bid, has engineered a stunning boardroom coup that leaves him in control of Constantin which is to restructure as a sports only business.

Owner of German broadcast business Sport1, Constantin plans to sell off its high profile film division, and look for opportunities in “sports- and event-marketing segments”. Senior executives also suggested it might launch a second sports channel – Sport2.

Top of Hahn’s targets will be Highlight Communications’ TEAM Marketing, a jewel in the crown of sports agency businesses in Europe. TEAM exclusively markets the UEFA Champions League. Constantin is a 60.5% shareholder of Highlight giving Hahn a gateway to perhaps Europe’s most attractive and connected sports agency.

But how far Hahn’s Constantin coup goes will be determined by the outcome of a legal challenge from shareholders who Hahn succeeded in having their voting roles annulled.

In an extraordinary two-day general meeting of shareholders, Franz Enderle, the chairman of the meeting, announced that only 47.1% of the voting share capital were present but that major shareholder Bernhard Burgener’s voting rights were annulled. Hahn had already removed Burgener from the day-to-day operations of Sport1 earlier this year.

The uproar that ensued at the meeting was more akin to a Marx Brothers movie than a serious shareholder meeting and even involved security being called – perhaps more drama than serious threat but certainly a concern for Hahn and his cronies pre-meeting who had arranged for the security to be on hand.

While Hahn’s group pushed through the resolutions to reorientate the company, Burgener’s group and lawyers maintained that it was being done illegally and fraudulently. Their continuing legal challenge will determine whether Hahn has pulled off one of the biggest media boardroom steals of recent years.

It is the movie business that will be the next victim in Hahn’s new regime as he now plans to sell the Constantin Film business and focus the group on sports interests.

The emergence of Hahn at the top of Constantin may raise eyebrows over his tactics but it seems unlikely to send a shiver down the spines of UEFA. TEAM chairman Martin Wagner kept cool, saying: “To quote Donald Trump (on George Bush not voting for him) ‘It’s sad, but it has no impact’ on TEAM.”

Hahn’s career has been controversial and includes one of the most spectacular failures of an international media businesses anywhere in the world. Hahn was Vice President of Kirch Holding’s Board of Management with responsibility for Communication, Multimedia and Sports. He was also managing director of holding company Taurus Holding.

In 2002 KirchGroup collapsed primarily due to overpaying for sports rights and in particular FIFA World Cup rights. The collapse sparked panic at FIFA ahead of the 2006 World Cup in Germany and a rapid re-evauation of accounting policy at FIFA which in turn lead to the huge reserves FIFA built up to protect themselves from any similar disaster in the future.

Perhaps more worrying for football is Hahn’s role in the German 2006 World Cup bid that is currently under investigation. Hahn was the conduit via Kirch-owned agency CWL of broadcast rights from countries who had voting members on FIFA’s executive committee.

The scandal has already brought down the biggest name in German football – Franz Beckenbauer – as well as former president Wolfgang Niersbach. Hahn through his Kirch executive position had oversight of the deals.

Hahn helped facilitate the process of buying the 2006 World Cup votes by using media vehicles under his control to acquire the rights.

Documentation obtained by Insideworldfootball contradicts the assertions of senior German 2006 World Cup officials that no financial inducements were paid to land the tournament and that a €6.7 million slush fund was set up to secure the event.

A secret memo from June 2000 appears to authorise thousands of dollars being paid by associates of German bid executive Fedor Radmann to private bank accounts linked to four FIFA voting members.

The correspondance, dated June 6, 2000, was sent by a lawyer of German media company Kirch to then Kirch CEO Hahn outlining a so-called “consultancy agreement”.

The letter appears to give the green light for payments to be offered in return for television rights to specially-arranged Bayern friendlies against four countries who had voting members: Malta’s Joseph Mifsud, Trinidad’s Jack Warner, Thailand’s Worawi Makudi and Slim Chiboub of Tunsia.

Bayern played Thailand  on June 3, 2000, Malta on January 12, 2001, and Tunisia five days later. The match against Trinidad & Tobago was never held.

The timing of the letter is highly significant in that it is dated just a few days after  a lucrative tv deal was struck for Bayern, whose president at the time was Beckenbauer, to face Malta in a friendly.

The contract, negotiated by broadcasting company CWL, which was owned by Kirch, was signed by then Maltese FA president a month before the vote for the 2006 hosts and included a remarkable clause stating that its very existence should remain secret. That Hahn was aware of the deal and sanctioned it as the senior executive as Kirch is the issue.

Contact the writer of this story at moc.l1709017910labto1709017910ofdlr1709017910owedi1709017910sni@n1709017910osloh1709017910cin.l1709017910uap1709017910