OFT investigates ITV's purchase of GMTV stake

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The Independent Online

The Office of Fair Trading is considering whether to refer ITV's proposed acquisition of a further 25 per cent stake in GMTV, the breakfast television franchise, to the Competition Commission, it said yesterday.

In a statement issued to the stock exchange yesterday afternoon, the OFT said it was inviting comments on the £31m deal, which must be submitted by 29 July. It will then make a decision on whether the deal should be referred on to the Commission.

ITV, the UK's biggest free-to-air broadcaster, already owns a 50 per cent stake in GMTV, which it inherited when the group was created by the merger of Carlton and Granada earlier this year. The successful acquisition of another 25 per cent from SMG would give it a 75 per cent holding and ultimate control of the breakfast franchise.

The proposed deal was first announced in May, but could now be held up for several months if the OFT decides to refer the deal on.

Andrew Flanagan, SMG's chief executive, said in May that he had decided to sell the stake because he "did not want to hold a minority interest in someone else's media business".

If the deal goes through, ITV is under an obligation to bid for the remaining 25 per cent, owned by Disney, at the same price.