ITV has agreed to buy UTV Media’s television assets in a £100 million deal which leaves Scottish broadcaster STV as the last remaining independent business in the Channel 3 network.
The acquisition, which is subject to regulatory and shareholder approval, will give ITV control of 13 of the 15 regional television licences.
Although there has previously been speculation that STV, which owns the central and northern Scotland licences, could be a bid target for ITV, analysts at one broker said after yesterday’s announcement that they didn’t believe the UTV sale made that more likely.
Analysts at Liberum said in a note: “We do not think ITV will make a bid for STV due to the political sensitivities of Scotland’s main commercial broadcaster being owned by London-based ITV.”
If approved, ITV said the deal would further strengthen its free-to-air business. Scots-born ITV chief executive Adam Crozier said: “We have a long-standing relationship with UTV, which has been the leading commercial broadcaster in Northern Ireland for many years thanks to its strong regional identity and blend of excellent local programming and strong network shows.”
John McCann, chief executive of UTV Media, said: “Becoming part of the ITV family is by far the best way to take UTV’s television business forward with an ongoing focus to provide brilliant television to viewers right across Ireland.”
ITV said the transaction would be financed through existing cash and debt facilities.
UTV’s television assets achieved total revenue of £34.7m and operating profit of £6.6m in 2014. However, the broadcaster posted lower profits in its half-year results this August. The company was the first commercial television channel in Ireland when it launched as part of the ITV Network in 1959. It has been in local control since then.
UTV Media plc said it is one of the most successful media companies in the UK and Ireland, incorporating radio, television and new media.
Some of Britain’s best-known TV personalities began their careers on the station, including Sky News anchor Eamonn Holmes, who started in 1979 by hosting a programme on farming.
Former UTV broadcaster-turned-leader of the Ulster Unionists, Mike Nesbitt, has warned Northern Ireland needs a strong local independent television station to offer competition to the BBC.
The firm aunched a station in the Republic of Ireland in January, called UTV Ireland. But the new Dublin station has struggled to find an audience and has racked up sizeable losses in the first half of the year.
UTV also owns a series of radio stations in Ireland and Britain, including TalkSport, which it retains under the deal.
Richard Huntingford, chairman of UTV, said: “I believe that the price reflects the inherent value within the UTV Television business.”