Speculation that ITV might now be looking at STV and Northern Ireland-based UTV to create a single, UK-wide Channel 3 service has been heightened by its purchase of the only other remaining non-ITV operator, Channel Television.
The Guardian's Mark Sweney reports how “a flurry of speculation that the broadcaster might also be sizing up a £300 million-plus buyout of STV and UTV, completing the near 20-year process of consolidating the network under a single owner”.
He writes: “UTV Media, which also owns radio stations including TalkSport as well as London free magazine Sport, has a market capitalisation of £116 million and a forecast of net debt of £58 million by the end of the year.
“STV has a market capitalisation of £38 million and a forecast of £51 million net debt at the end of the year. The company significantly tidied up its balance sheet in April last year offloading cinema advertising business Pearl & Dean.”
He also notes: “In April, STV reached an £18 million settlement with ITV to end a long-running series of legal disputes.”
And he quotes an Ian Whittaker, an analyst at Liberum Capital, as saying: “The acquisition of Channel Television is not that significant in itself but there would be significant strategic logic from acquiring the other two groups. It would simplify the ITV structure into one firm … and there would (presumably) be synergies on the revenues and cost side from a more efficient ITV structure.”
And Sweney immediately adds: “Such a move would potentially allow ITV plc to cuts costs by removing any remaining duplication across the network in areas such as scheduling, programme compliance, production and airtime sales.”
