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* Mediaset buy 9.6% stake in Germany's ProSiebenSat.1
* Seen as move to play part in any Europe-wide consolidation
* "A friendly acquisition" - Mediaset
* ProSieben CEO calls stake purchase a vote of confidence (Writes through, wrapping company comment, banking sources, context and shares)
MILAN/FRANKFURT, May 29 (Reuters) - Italian broadcaster Mediaset has bought a 9.6% stake in Germany's ProSiebenSat.1, effectively securing a seat at the table in any future discussions on creating a pan-European TV company.
The news of the 330 million euro ($368 million) investment follows months of speculation that Mediaset, controlled by former premier Silvio Berlusconi's holding company Fininvest, wanted to merge with Munich-based ProSieben, whose beaten-down shares jumped as much as 7% in response.
Both companies, as well as European rival RTL Group and Britain's ITV, are struggling with weak advertising revenues as younger viewers shift to streaming offerings from Netflix and Amazon Prime.
Yet, so far, attempts at cross-border deals to create a so-called 'Euroflix' have come to nothing, stymied by a lack of synergies - a result of the many languages and varied tastes of viewers across the region.
Commenting on the stake purchase, Mediaset CEO Pier Silvio Berlusconi, the son of the former Italian prime minister, said: "The friendly acquisition of a stake in ProSiebenSat.1 is a long-term choice."
Responding, ProSieben CEO Max Conze welcomed the Mediaset stake as a "vote of confidence in our strategy and team".
Sources from both sides stressed that the move was a financial investment.
Mediaset does not plan to further increase the stake a the moment or seek board representation at the German group, a source close to the matter told Reuters.
Bankers and analysts said Mediaset had secured a cheap entry after ProSieben's stock touched seven-year lows in March, reflecting market scepticism over the turnaround effort pursued by Conze, who joined last June from UK appliance maker Dyson.
Conze, who has restructured ProSieben into three divisions and wants to bolster its e-commerce portfolio to diversify away from traditional commercial TV, has backed his own strategy by buying 2 million euros in ProSieben stock.
"It's a smart opportunistic move by Mediaset to play value," said one media banker of the deal. The step would also deter private equity players who had recently been looking at ProSieben from pursuing a possible buyout, the banker added.
Mediaset bought the stake through an option structure called a 'collar', another banker said, effectively enabling it to acquire it in one go without triggering disclosures at lower thresholds of 3% and 5%.
This approach has been deployed by Chinese investors to build stakes in carmaker Daimler, fuelling concerns in Germany that foreign investors and their advisers had figured out a way to bypass the system.
The Italian company, which also controls Spanish free-to-air broadcaster Mediaset Espana, is now ProSieben's second- largest shareholder in term of voting rights, after Capital Research Global Investors.
Last month, Mediaset's finance chief said the group could take up 1 billion euros ($1.1 billion) in new financing for potential acquisitions. Mediaset said the deal would not affect a decision on a dividend payment expected in July.
Mediaset tried to broaden its business in 2016 with a pay-TV agreement with French media giant Vivendi aimed at building a southern European media powerhouse.
But the deal fell through when Vivendi, which owns 28.8 percent of the Italian group, backtracked, leading to a court battle.
The sequence of events has left Mediaset weaker in relation to other potential participants in any 'Euroflix' project, making the acquisition of the ProSieben stake an important down payment towards being included in any wider deal.
Talks on forming alliances are happening between Mediaset, ProSieben and Discovery, as well as with France's TF1 and RTL Group, said one banker close to the situation.
ProSieben is, meanwhile, seeking more partners for its own streaming platform, called 'Joyn', that will launch in June in partnership with Discovery Inc.
Luxembourg-based RTL has rebuffed ProSieben's invitation to sign up to Joyn and is pursuing its own streaming projects. Its CEO recently departed abruptly, however, leading the banker to suggest RTL may become more open to cooperation.
Mediaset's move comes two weeks before ProSieben holds its annual shareholders meeting, where the company's nine existing supervisory board members are up for re-election. ($1 = 0.8964 euros)
(Writing by Douglas Busvine Additional reporting by Arno Schuetze, Alexander Huebner and Stephen Jewkes Editing by Keith Weir)