Comcast’s Sky has announced that it plans to acquire ITV Media & Entertainment from ITV plc for a total consideration of up to £1.6 billion ($2.14 billion), comprising £1.2 billion ($1.6 billion) in cash, Love Productions, and up to £0.2 billion ($0.27 billion) in performance-related earn-out.
The announcement comes just a week after Comcast announced plans to spin off its NBCUniversal and Sky operations into a separate company.
The proposed deal would create a powerhouse in the U.K. media industry that the two companies said they need to effectively compete with global streaming players.
ITV already reaches around 40 million people every week and serves more than 16.5 million monthly digital users. Combined with Sky, the business would account for around 20% of all in-home viewing in the UK, second to the BBC and ahead of YouTube, and create a commercial streaming champion for the U.K.
Analysts have pointed out, however, that the combination would also control about 70% of the U.K. TV ad business and that the proposed deal will face extensive regulatory review.
Together, Sky and ITV Media & Entertainment will combine free-to-air broadcasting, advertising-funded streaming and subscription television together with Sky’s wider portfolio of broadband, mobile and business services. In announcing the deal, the two companies said that the diversity of revenue streams of the combined entity provides a resilient and durable business model which will underpin its long-term success.
“This is a defining moment for British media and an opportunity to build a stronger future for two of the UK’s most loved and trusted brands,” Dana Strong (CBE), Sky Group CEO, said. “We have huge respect for the transformation the ITV team has delivered, particularly its successful move into streaming through ITVX, which has brought fantastic British content to millions of viewers across the UK. Bringing Sky and ITV Media & Entertainment together combines the very best of free-to-air television, pay TV and streaming, ensuring viewers across the UK continue to enjoy outstanding British programming in a rapidly changing world. ITV will remain a public service broadcaster at the heart of British life, and we’re excited about the future we can build together.”
Following completion, ITV channels and ITVX will remain free-to-air, with its public service broadcasting commitments continuing to be met in full. Audiences will continue to enjoy the programs they know and love, alongside trusted national and regional news. Sky will continue to be the home of world-class entertainment, unmissable sport, and market-leading connectivity.
ITV News and Sky News will remain distinct editorial voices, continuing to provide trusted journalism to audiences across the UK.
In addition, Sky has agreed to enter into a £2.1bn ($2.8 billion) content supply agreement over 5 years with ITV Studios upon completion of the deal. The agreement will support continued investment in British programming while sustaining jobs, skills and growth across the UK’s creative industries.
“ITV has successfully evolved in a rapidly changing media landscape – launching, and scaling, ITVX and developing ITV Studios into a major force in the global content market,” Carolyn McCall (DBE), CEO of ITV plc, added. “This transaction builds on that momentum to deliver clear, tangible value for shareholders. At the same time, through the commitments made by Sky, the combined ITV M&E / Sky business will continue to deliver everything about ITV that our viewers and advertisers love and value and our people are hugely proud of – making programs that reflect and shape society, bringing people together for shared experiences and having the quality, diversity and plurality that are the hallmarks of our contribution to the UK’s creative industries. In addition, all of ITV’s PSB commitments, including regional and national news, are safeguarded under the terms of the Channel 3 Licences until 2034, which Sky is acquiring as part of the Transaction.”
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‘ Some details of this article were extracted from the following source www.tvtechnology.com ’
