Granada and Carlton agree £2.6bn merger

Broadcasters Granada and Carlton have agreed to merge in a deal that paves the way for a single ITV company.

Broadcasters Granada and Carlton are to press their case for a single ITV after agreeing to a £2.6 billion merger today.

The two said a tie-up would lead to increased investment in programming, higher audiences and a greater reach for advertisers.

A deal is also likely to lead to fears about job losses, with savings of at least £35 million a year expected to come from a merger.

In a joint statement, the two indicated there were overlaps in back-office functions, broadcasting, content and central services.

Granada boss Charles Allen would led a combined operation as chief executive while Carlton chairman Michael Green would chair the group.

Mr Green said: "One ITV has been a vision long in the making.

"One company, with one management and one focus, can now set its sights on firmly beating the opposition and giving viewers and advertisers what they want.

"I want this merger to mean great television programmes and the strongest possible schedule. We must make sure that it does just that."

Confirmation of a deal comes after a tie-up was agreed in principle on Friday. Merger talks previously broke down in February.

Granada shareholders will take a 68 per cent stake in the new business and receive £200 million in cash. Carlton shareholders will hold a 32 per cent share.