ITV plc
19 October 2015
ITV TO ACQUIRE UTV'S TELEVISION BUSINESS
ITV plc today announced that it has agreed to acquire 100% of UTV Ltd, which owns the television assets of UTV Media plc, for a total cash consideration of £100 million. This is subject to regulatory and UTV Media plc shareholder approval. The transaction will be financed through existing cash and debt facilities.
The deal further strengthens ITV's free to air business and enables it to run a more efficient network. On completion of the acquisition ITV will own 13 of the 15 regional licences for the Channel 3 network and the combined business will benefit from ITV's continued investment in content, its advertising sales team and broadcast infrastructure.
UTV is the market leading commercial broadcaster and the most watched channel in Northern Ireland, broadcasting ITV content alongside high quality local programming. UTV Ltd also owns 100% of UTV Ireland, which launched a new dedicated channel for the Republic of Ireland on 1 January 2015. UTV Ireland is already the second most watched channel in peak in Ireland and ITV intends to strengthen the channel further with high-quality ITV programming at its core.
"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," said ITV Chief Executive Adam Crozier.
"UTV Television's strategic objectives are closely aligned with our own and we are very pleased that they are joining the ITV family. We are looking forward to working with the team going forward."
John McCann, Group Chief Executive of UTV Media plc, said:
"The market leading success of our television business has been built over many years on the well-established formula of high quality local programming packaged around an attractive network schedule. 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."
Ends
Note to Editors:
1. The deal excludes UTV Media plc's radio businesses UTV Radio GB and UTV Radio Ireland, and its digital media businesses, Simply Zesty and Tibus Digital.
2. The television assets of UTV Media plc reported total revenue of £34.7m (2013: £34.1m) and operating profit (excluding central costs remaining with UTV Media plc) of £6.6m (2013: £8.9m) in 2014. The 2014 operating profit included £3.0m costs in relation to start-up costs for UTV Ireland.
3. As part of the transaction, UTV Media plc will cease to have liability for the defined benefit pension scheme which will remain with UTV Limited. At 30 June 2015 the IAS19 deficit was £3.2m. ITV has agreed with the Trustees that UTV Ltd will pay deficit funding contributions of £640,000 per year for seven years.
4. Regulatory approval is required from Ofcom, the Broadcasting Authority of Ireland, the Irish Competition and Consumer Protection Commission and the Irish Minister for Communications.
5. UTV advertising sales will be reported under NAR while programme costs will be reported within the programme budget. ITV's other revenue will be impacted by the loss of revenue received from providing other services to UTV such as programming and advertising sales.
6. As part of the deal ITV is acquiring the UTV brand.
7. The deal includes a break fee arrangement with UTV Media plc such that UTV Media plc will pay ITV a fee of £1 million if the deal fails to complete as a result of UTV Media plc failing to obtain the approval of its shareholders to the deal by no later than 31 December 2015.
8. ITV has been advised on the transaction by Credit Suisse.
For further enquiries please contact:
Investor Relations
Pippa Foulds 0207 157 6555 or 07778 031097
Media Relations
Mary Fagan 0207 157 3706 or 07736 786448
Mike Large 0207 157 3021 or 07768 261528
Credit Suisse International, which is authorised and regulated in the UK by the Financial Conduct Authority and the Prudential Regulation Authority, is acting exclusively as financial adviser to ITV plc and no one else in connection with the matters described in this announcement, and will not be responsible for anyone other than ITV plc for providing the protections afforded to clients of Credit Suisse International nor for providing advice in relation to the matters referred to in this announcement. Neither Credit Suisse International nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Credit Suisse International in connection with this announcement, any statement contained herein or otherwise.
