The ITV Network is about to take a further step towards what many
see as its inevitable consolidation, with Carlton Communications and
United News & Media (UNM) moving towards sealing a pounds 7.8 billion
merger deal.
The new group would become the largest commercial broadcaster in the
country and by far the largest player in the ITV Network.
Carlton owns the ITV franchises for London weekday television (Carlton
Television), Central Television, West Country Television, and also has a
20 per cent stake in the South-East franchise Meridian Broadcasting.
UNM owns the remainder of Meridian, Anglia Television, HTV and has a 29
per cent stake in Channel 5.
The news has got rival ITV company Granada worried, fuelling reports
that it too may bid for UNM.
According to the latest figures from the Independent Television
Commission, for the 12 months up to September 1999, the ITV Network took
a total share of TV viewing, including cable and satellite channels, of
31.3 per cent.
Of this, franchises owned by Carlton and UNM accounted for 14.9 per
cent.
Fortunately, the current competition restrictions prohibit any one group
taking more the 15 per cent of total UK viewing.
Meanwhile Granada, with its LWT, Tyne Tees, Yorkshire and Granada
franchises, has a total viewing share of 10.7 per cent - just over one
third of the ITV Network’s total share of viewing.
If Granada attempted a counter-bid, UNM would be its most likely target
as the combination of the two would create a smaller share of viewing
than a similar merger between Granada and Carlton.
A Granada/UNM share of total UK viewing would be around 17.3 per cent
(about 55.3 per cent of viewing to the ITV Network) which would be in
breach of the current regulations.
However, it is likely most major UK broadcasting companies will lobby
the Office of Fair Trading to remove these restrictions.
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