The television group RTL Germany and the Hamburg magazine publisher Gruner and Jahr merge.
The new company will start operations at the beginning of next year, announced the Bertelsmann Group on Friday.
Both companies belong to the Gütersloh media group.
Carsten Germis
Business correspondent in Hamburg.
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Bertelsmann boss Thomas Rabe said that the responsible bodies had come to the conclusion that the two companies “can better exploit their growth potential together”.
Around 1,500 journalists will work in the new company.
With the merger, strong content and brands would be merged across media and television, streaming, radio and print formats would be in one hand.
"No other media company in this country can create such a cross-genre growth alliance," said Rabe.
Bertelsmann has been discussing a possible merger since February - as it is called "open-ended".
With the current decision for a merger, Rabe sees the company's media business on the German market strengthened in competition with global tech platforms such as Netflix and Amazon.
The new company has unique selling points compared to its global competitors. It is aimed at the public with an offer of local content of all genres. The participation of Gruner + Jahr in the Hamburg news magazine Spiegel as well as DDV, Territory and Applike will not come to RTL, but will stay with Bertelsmann. Hamburg is also to remain the headquarters of Gruner + Jahr after the merger. The publisher is behind titles such as Stern magazine or Brigitte and Gala magazines.