John de Mol shrouds his TV empire Talpa in mist

Now that regulator ACM has not given permission for the combination of RTL Nederland and Talpa Network that RTL Group and John de Mol desperately wanted, the owners of the media companies are left with a hangover. More than a year and a half of preparations have been in vain.

Situation known to RTL

For the German-Luxembourg RTL Group, the damage is still manageable. Subsidiary RTL Nederland has performed excellently in recent years. In 2021, the company posted an operating profit of 107 million euros on a record turnover of 575 million euros.

That line was continued in the first half of 2022. During that period, operating profit increased by almost 60 percent to 86 million euros, and turnover by 20 percent to 303 million euros. “It is the first half of 2022 best half year from our history,” said director Sven Saved of RTL Netherlands in August.

More good news

And there is more good news. Figures from the Kijkonderzoek Foundation show that the joint average market share of the channels of RTL Nederland increased from 22.6 to 24.6 percent between 2019 and 2021.

This strengthened RTL’s position as the second player in the Dutch television market, after the three channels of the Dutch Public Broadcasting (NPO) with a market share of 36.3 percent.

In addition, the company has Videoland, which allows it to compete with foreign streaming services such as Netflix, Disney + and HBO. And finally, there are probably other partners who want to get into bed with RTL Nederland. Previously, the names of Vodafone Ziggo and DPG Media, the publisher of de Volkskrant and AD, circulated.

Talpa’s position unclear

However, it is largely unclear how Talpa Network stands now that the takeover has failed.

It is true that figures from Stichting Kijkonderzoek show that the combined average market share of Talpa’s four television channels shrank from 16.6 to 15.9 percent between 2019 and 2021. But nothing is known about the company’s finances.

In the Netherlands, companies are of some size obliged to file their financial results and capital position in the form of annual accounts with the Chamber of Commerce (KvK) every year. But no annual accounts of Talpa Network can be found in the Chamber of Commerce register. Also on websites like Mediamonitor sales and profit data are missing.

Big boy

Yet Talpa Network is no small boy. The company hosts four national television channels, SBS6, Net5, Veronica and SBS9. After NPO and RTL, it is the third party on the television market. In addition, Talpa owns four radio stations and several e-commerce companies.

It can be deduced from figures from a reorganization from 2020 that there will still be 1200 people worked at the company. And from the presentation of the merger plan with RTL it follows that in 2020 Talpa will have a turnover of 433 million euros booked.

It should be noted that press agency ANP was still included at the time, but was sold in 2021. The last known annual turnover of the ANP was just under 25 million euros, and it employs about 250 people. So you have to subtract that from the above numbers.

Topco ook blanco

A company with a turnover of around 400 million euros and a thousand employees is obliged to file annual accounts with the Chamber of Commerce, but those of Talpa Network cannot be found there.

Inquiries at the Chamber of Commerce show that the responsibility for filing the annual accounts lies with the (current) parent company Talpa Topco Holding 2. However, that company has not yet submitted the annual accounts for 2021 either.

According to the Chamber of Commerce, this can be explained by the fact that this is a new company, which was founded in July 2021, and whose first financial year ends at the end of December 2022. “They then a year to file the annual accounts.

Enforcement

However, this is no explanation for the absence of Talpa’s annual accounts for previous years. In the past, according to the Chamber of Commerce, the filing obligation was with another parent company, with the (almost identical) name Talpa Topco Holding II.

However, the annual accounts of that company are also missing. “No annual accounts have been filed for the previous holding company either,” the Chamber of Commerce writes in response to questions from RTL Z. “It should have been.”

The Chamber of Commerce says it cannot comment on the consequences, because it has no enforcement powers. “It may be that agreements have been made with the Tax and Customs Administration that declare non-depositing.” For this purpose, the institution refers to the Economic Enforcement Bureau (BEH), part of the Tax and Customs Administration.

Priority

A spokesperson for BEH says that the organization cannot make any statements about individual cases. He does indicate, however, that the BEH is scrutinizing reports from the Chamber of Commerce about companies that do not submit annual accounts. It uses a list of six types of cases that ‘get priority’.

Talpa Network appears to score positively on at least three criteria; as a large company, as a repeat offender and as a refusal on principle.

The spokesperson generally acknowledges that a company that scores on three of the six priority criteria will probably have come into the crosshairs of the BEH enforcers. “Although we cannot say anything about specific cases.”

Fine 22,500 euros

According to the spokesperson, the BEH draws up 1000 to 1500 official reports every year, following the non-filing of annual accounts. He then forwards it to the Functional Prosecutor’s Office of the Public Prosecution Service.

There it is decided which cases will be prosecuted, or whether a punishment order will follow without the intervention of the court.

How many of the 1000 to 1500 official reports lead to a criminal order, prosecution or / and conviction, the BEH and the Public Prosecution Service could not say in recent days. The highest fine that can be imposed is 22,500 euros.

Punishment unknown

Because the BEH and the Public Prosecution Service cannot say anything about individual cases, it remains a guess whether Talpa Network was ever reprimanded for (structurally) not reporting the annual figures. Not to mention the amount of possible punishment.

Fines or not, it is clear that De Mol’s television company does not care much about it. Topman Pim Schmitz of Talpa Network confirms to RTL Z that the company does not disclose any figures. “We never publish financial results. We never have, and we will not. Not in the future.”

Calculate yourself

When asked why Talpa does not comply with the legal filing obligation and thus commits an economic crime, he does not want to answer. “We do not make any further announcements about that. Anyone can make those calculations themselves. You can see exactly which companies we are in, and what market shares they have.”

He does not want to say whether Talpa has received fines or penalty payments for not submitting the annual accounts in the past. “We’re not going into that at all.”

How De Mol got his Talpa transmitters

Super entrepreneur John de Mol became a billionaire thanks to the IPO and subsequent sale of the television producer Endemol. After leaving that company, he built up a producer again, Talpa Media. He sold it to the British ITV in 2015.

In addition, De Mol was also involved in television channels. In 2005 he started his own channel Tien, later renamed Talpa. Because the channel was ailing, he sold it to RTL Nederland in 2007 in exchange for a quarter of the buyer’s shares.

He had to divest himself of that interest again in 2011 after he acquired the television channels of SBS Broadcasting bought, at the time with 538 employees good for a turnover of 316 million euros.

The collaboration with Samoma was difficult, and in 2017 De Mol bought out his co-shareholder. For 237 million euros he became full owner of the SBS channels. These were due to the failure of his takeover attempt of the Telegraaf Media Groep (TMG) the most important business unit of Talpa Network.

In 2021, De Mol closed a deal to merge that company with RTL Nederland, in exchange for 30 percent of the shares in the combination. But on Monday it turned out that cartel watchdog has that amalgamation forbidden.

Where De Mols sold television producer Talpa Media in 2015, did publish financial figures, the television channels and parent companies Talpa Netwerk and Talpa Topco do not. As a result, it is currently not clear how good or bad the company is doing.