ITV 'in talks to buy film mogul Weinsteins' TV business for £630m'
Published 08/04/2015 | 07:38
ITV is reportedly preparing a £630m takeover of the television production business founded by the film mogul Weinstein brothers, a move that would signal the broadcaster’s ambitions in big-budget, small-screen drama.
Shares in ITV, which declined to comment, spiked more than 2pc on Tuesday following the claims.
A takeover would be the latest in a string of production acquisitions by ITV, which is aiming to become less reliant on volatile advertising sales by taking ownership of more programming that can be sold overseas.
The Weinstein Company’s television arm would represent something of a departure for ITV’s expansion strategy, however.
Its recent deals on both sides of the Atlantic, such as last month’s £355m acquisition of the Dutch company Talpa, have focused mostly on formats and reality television.
The Weinstein Company’s television arm produces the sort of reality shows that have become ITV Studios’ mainstay, such as the fashion competition Project Runway. The American producer also competes, however, in the big-budget drama market, producing serials such as Marco Polo for Netflix and the No. 1 Ladies’ Detective Agency with the BBC. It is also jointly producing an adaptation of War and Peace with the BBC for broadcast next year.
ITV could use a takeover to seek to better tap into the growing international market for television drama. Appetites have been boosted over the past decade by a run of critically acclaimed series from US cable broadcasters led by HBO, as well as increasingly fierce competition for exclusive programming between broadcasters and internet streaming services such as Netflix and Amazon.
The biggest international drama hit linked to ITV has been Downton Abbey, which attracts a US audience of more than 10m. However, the programme is not produced by ITV itself so it has not enjoyed the spoils of that success. More recent in-house dramas, such as Mr Selfridge, are an attempt to take a bigger slice of the international market.
The Weinstein brothers Bob and Harvey, who are frequently named in lists of the most powerful executives in the American entertainment industry, began exploring a sale of their television business last summer. They reportedly initially sought bids from technology companies including Amazon and Google, but are now close to an agreement with ITV.
According to the New York Times, the Weinstein Company would receive cash in stages from an ITV takeover, beginning with an initial payment of around £200m. The Weinstein brothers, co-chairmen, would continue to oversee the television arm, the newspaper said, suggesting it could continue to benefit from their mogul status.
Ian Whittaker, an analyst at Liberum, said: “If this does happen, this will strengthen further ITV’s content portfolio, especially post the acquisition of Talpa, and heighten the company’s attractiveness.
“Together with Talpa, it will give it a major status in the US. Like with Talpa, it should be taken well.”
ITV is seeking to expand its production business at the same time as defending its broadcasting and advertising position, which remains the largest contributor to its sales. Although its share of viewing in the UK has been in decline, its advertising sales have held up as brands turn to its main channel as a way to reach a mass audience in a fragmenting media landscape.