ITV has released a statement this morning to confirm that it is in “preliminary discussions” over a sale of its media and entertainment business.
“ITV plc notes the recent press speculation and confirms that it is in preliminary discussions regarding a possible sale of its M&E business to Sky for an enterprise value of £1.6bn.
“There can be no certainty as to the terms upon which any potential sale may be agreed or whether any transaction will take place. A further announcement will be made in due course if appropriate.”
Any potential sale wouldn’t include ITV studios, which has also been at the centre of takeover speculation, with the company said to have been in “early-stage” talks with RedBird IMI earlier this year.
READ MORE – Report – ITV in merger talks with RedBird IMI
Should the £1.6bn deal go ahead, Comcast-owned Sky would be buying ITV’s free-to-air channels and ITVX platform.
That would mean it would also have public service broadcasting obligations, including the provision of local news.
The move comes after ITV announced revealed that it would have to make £35m in further cost savings as it prepares for a difficult fourth quarter. Those savings were all identified within the M&E division.
READ MORE – ITV to make £35m cost savings despite slight Q3 revenue uptick
Total group revenue was £2.8bn, with ITV Studios making up £1.4bn of this. Digital advertising revenue increased 15% thanks to a strong performance by streamer ITVX.
It’s likely that any deal would have to go through regulatory processes.
