Sky adds HTV to list of backers for ITN challenge


Media Editor

HTV, one of the media sector's hottest takeover candidates, is backing a bid by Rupert Murdoch's BSkyB to supply news to ITV in competition with Independent Television News.

The news emerged as the company revealed sharply higher profits for 1995 and predicted further gains in 1996.

Chris Rowlands, HTV chief executive, said: "We have an agreement in principle to support Sky's application to be a nominated news provider".

The other partners in the joint venture are ITV companies Yorkshire-Tyne Tees, Meridian and Anglia, as well as the financial information company Reuters, a shareholder in ITN. The group is expected to underbid ITN for the contract to supply news to ITV. Reuters currently has a "non-compete" clause with ITN but its lawyers are believed to have argued it is not enforceable.

BSkyB is expected to lodge its application in coming weeks. It has promised to reduce the annual cost to ITV for its news services to about pounds 30m, from the current pounds 55m paid to ITN.

Meanwhile, HTV's pre-tax profits climbed 66 per cent to pounds 12.1m, on revenues ahead 11 per cent to pounds 135m, in line with expectations. The company revealed it spent pounds 300,000 on its unsuccessful bid for the Channel 5 licence, as part of the Virgin consortium.

HTV is considered a potential bid target for Carlton Communications, Michael Green's media company, which last week abandoned a possible bid for MAI, Lord Hollick's media and financial services group.

The core broadcasting business, which includes the ITV licences for the West and Wales, had turnover of pounds 104m. The newly named Harvest Entertainment division, which takes in film, TV production and programme rights, posted revenues of pounds 30.8m. Harvest's contribution to profits increased from 30 per cent to about 37 per cent year on year.

Louis Sherwood, the chairman, said the growing importance of production and rights acquisition has helped transformed HTV into a "medium-sized media company, not just an ITV licence franchisee like some of the others."

Through its Patridge Films and First Independent brands, HTV is a major supplier of wildlife and childrens programming to a range of UK and overseas broadcasters.

The company continued to push costs down in 1995, partly by squeezing margins at independent suppliers as part of what Mr Sherwood described as "getting value for money."

Advertising revenues were slightly down year on year, partly because two major advertisers, Boot's and Gillette, dropped HTV from their list of broadcast outlets. Gillette has since returned to HTV, while Boot's has plans to do so soon.

Mr Rowlands said he was optimistic that the company's licence payment to the Treasury, which totaled pounds 23.3m last year, would be reduced following discussions with the Independent Television Commission. Several ITV companies tabled very high financial bids to win their franchises in the last licencing round in 1992, and these could be renegotiated starting later this year.

Analysts expect that HTV could see its net payments to Treasury decline substantially from 1997 on. That could be offset by a drop in the levy paid to ITV by Channel 4.

Investment Column, page 18

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

Day In a Page

Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
10 best PS4 games

10 best PS4 games

Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
Transfer window: Ten things we learnt

Ten things we learnt from the transfer window

Record-breaking spending shows FFP restraint no longer applies
Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent