ITV told the market in preliminary talks to sell the company’s broadcast arm skyrocketed 18% in early trading.
Comcast, the US Telecom Company that also owns NBCunSal, is looking at snapping up ITV’s media and entertainment portfolio, which includes UK platforms, as well as its ITVX platform.
However, the agreement does not include the program of the broadcaster-production arm ITV Studios, one of the largest production companies in the world. The split, which produced shows including Love Island, I’m a Celebrity and the hit drama Mr Bates vs the Post Office, has been the subject of various takeover talks.
ITV said there was “uncertainty” about the terms of a potential sale, or whether the sale would take place.
The comments sent ITV’s share price up 18% at the start of trading on Friday morning to 80.9P, which translates to almost 9% for the year. That makes it the highest riser in the FTSE 250 Index, and boosts the company’s total value to around £3bn, up from more than £2.5bn last night.
However, the combination of ITV’s TV ad operations and Sky could spur competition, giving Comcast potential control of over 70% of the UK market.
Industry sources said Sky had to look at remedies including leaving third-party sales deals, which included representing ad sales for Channel 5 and Disney in the UK. The competition regulator may need to consider how it measures the ad market to include digital advertising.
“There is no certainty as to the terms on which any potential sale may be agreed upon or whether any transaction will occur,” ITV said in a statement to the market on Friday. “Further announcements will be made in due course as appropriate.”
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News of the possible deal comes shortly after ITV said on Thursday that it would “temporarily” join the pre-budget pre-budget late-budget budgets.
The company said it expects advertising revenues, which account for the majority of revenue, to fall 9% in the quarter on Christmas advertising.