Parent company confirms talks to sell UTV Ireland
Published 25/08/2015 | 02:30
UTV Media has confirmed it is in talks to sell its television assets, which include UTV Ireland.
The company told the Stock Exchange yesterday morning that "discussions are ongoing and may or may not result in such a transaction being agreed".
A further announcement will be made when appropriate.
Media speculation over the weekend linked UK company ITV with a move for the television assets. TV3 owner Liberty Global - billionaire John Malone's media business - has a 10pc stake in ITV. ITV declined to comment.
UTV Media, which launched as Ulster Television in 1958, forecast in June a deeper-than-expected full-year loss at UTV Ireland, its new Republic of Ireland channel, as audience growth stalled.
Peel Hunt analyst Alex Degroote said a sale could fetch between £100m and £125m.
UTV's television division, which operates in both Northern Ireland and the Republic, accounted for 36pc of its revenue last year, according to Thomson Reuters data. Most of the company's revenue comes from radio. UTV Media warned in June that its channel in the republic faced a loss of £11.5m, nearly double the £6m it had forecast in March, and said it had a plan to address the audience shortfall.
"UTV is losing a lot of money in its Republic of Ireland TV business. That is putting the Plc balance sheet under a lot of strain. And therefore, we have been thinking for a little while that the company needed a solution to this problem," Mr Degroote said.
He added that UTV has a close working relationship with ITV Plc because of shared programming and probably approached the much larger broadcaster.
UTV shows ITV programming as an owner of the Channel 3 franchise in Northern Ireland and runs shows such as 'Lesser Spotted Ulster'.
A sale to ITV was expected to be confirmed this week and will mark the first time the TV channel would pass out of local control since it was set up, the 'Belfast Telegraph' said.
Earlier this year, UTV Media plc, which is led by chief executive John McCann, acquired licences for four new digital radio stations. There will be three talk radio stations - talkRADIO, talkSPORT 2 and talkBUSINESS - and the return of Virgin Radio under a 12-year licence agreement between UTV and the Virgin Group.
UTV is due to report first- half results for 2015 on Friday. Goodbody stockbrokers is forecasting group revenue of £62m and an operating profit of £2.5m. In June this newspaper reported that UTV Ireland was being forced to rethink its programming strategy as losses mount and audience growth stalls. (Additional reporting Reuters)