April 1, 2019 / 11:47 AM / 7 months ago

UPDATE 1-Bertelsmann's Rabe takes over as CEO at TV unit RTL Group

* CEO Habets stands down for family reasons

* Rabe to run both Bertelsmann and RTL

* Pledges continuity on strategy, to back local streaming services

* European broadcasters under pressure from Netflix, Amazon Prime (Adds Rabe interview, context)

By Jörn Poltz

MUNICH, April 1 (Reuters) - Thomas Rabe, the CEO of German publishing group Bertelsmann, took additional charge of its TV unit RTL Group on Monday, replacing Bert Habets who resigned for family reasons.

The shakeup comes as European broadcasters are struggling with weak advertising revenues and are scrambling to respond to the challenge posed by streaming giants led by Netflix and Amazon Prime.

Rabe said however that there had been “no strategic differences” with Habets. He pledged strategic continuity and said he would take on the second job for the long term.

“This is a permanent solution,” Rabe told Reuters.

Rabe, 53, returns to the largest of Bertelsmann’s eight divisions having earlier been its chief financial officer. He said he knew the firm well and the additional responsibility would be manageable.

The departure of Habets, who had been sole CEO at RTL since January 2018, follows upheaval at German rival ProSiebenSat 1 Media, which brought in Max Conze as CEO last June and has just hired a new finance chief.

The companies face stagnant or declining ad revenues at their core TV franchises, while they have yet to achieve scale in offering video-on-demand services that allow users to watch shows online, when and where they want.

RTL wants to expand its streaming portfolio following promising starts in Germany and the Netherlands. It announced last month that it would invest 350 million euros ($393 million) over the next three years to treble its audience.

The Luxembourg-based broadcaster has declined to join a streaming alliance backed by ProSieben, in partnership with Discovery Inc, which is expected to go live later this year.

Rabe, in a statement, said: “RTL Group will continue to focus on three priorities: further strengthening its core TV, audio and production business, building local video streaming champions, and growing its advertising technology business.”

Bertelsmann also tweaked governance at RTL, promoting former Barclays CEO Martin Taylor to chairman of the board and naming former Nestle CFO James Singh as vice chairman.

Shares in RTL, a constituent of Germany’s MDAX mid-cap index, erased earlier gains following Rabe’s appointment to trade flat on the day.

$1 = 0.8905 euros Reporting by Douglas Busvine; editing by Thomas Seythal and David Evans

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