Hollick's TV empire is sold in a 'friendly' deal

ITV, Britain's biggest commercial television channel, moved from three principal owners to two yesterday when Granada Media agreed to buy the broadcasting and programme making operations of Lord Hollick's United News & Media for £1.75bn.

ITV, Britain's biggest commercial television channel, moved from three principal owners to two yesterday when Granada Media agreed to buy the broadcasting and programme making operations of Lord Hollick's United News & Media for £1.75bn.

Charles Allen, chairman of Granada Media, and Gerry Robinson, the former chairman and now Arts Council chairman, forced the purchase amid veiled threats to make a hostile bid for United - which also owns Express Newspapers - had Lord Hollick resisted a "friendly" deal.

Already the largest ITV group, Granada now dwarfs its remaining rival Carlton Communications, which last week abandoned plans to merge with United because of regulatory obstacles.

Mr Allen said a Granada-led ITV would move aggressively to embrace multi-channel television, and that a package of ITV-branded channels was likely to become available on Sky Digital next year. Until now, satellite viewers have been forced to switch to ITV's terrestrial signal to view Channel 3.

"The big strategic issue is putting a multi-channel ITV on Sky," Mr Allen said. He brushed aside suggestions that Granada Media had fallen behind BSkyB, which will soon have 5 million digital subscribers. "[Granada Media] is a real business with real turnover and real profits," he said. "I don't think we're falling behind Sky."

The acquisition of Lord Hollick's three ITV licences - Anglia in eastern England, Meridian along the south and south-east coasts and HTV in Wales - gives Granada Media £1bn in annual advertising sales, one-third of Britain's television advertising market.

Granada Media already owns the Manchester-based Granada licence, London Weekend Television, Yorkshire TV and two smaller licences in Teesside and along the Scotland-England border.

Mr Allen said: "This is not only a transforming deal for Granada, but a transforming deal for ITV. It moves ITV from a federation to a partnership. Through collaboration with Carlton there is an opportunity to seize many of the benefits of a one-company ITV."

With more than £500m in annual programme sales, the enlarged Granada will be Britain's biggest television content provider after the BBC. Granada favourites such as Coronation Street will be joined by United programmes such as Survival and Where the Heart Is and its wildlife programme making arm.

The link will also bring together online assets. Both companies have been developing multimedia educational content for schools and other new media content.

The week of meetings that led to the deal focused on securing the lucrative TV assets.Mr Allen said: "This is a good deal. We are buying very good assets at a very good price."

For £500m cash and £1.25bn of its shares, Granada Media gains a big presence in prosperous southern England to go with its dominance in the North. But Mr Allen wasted no time in setting his sights on the next round of consolidation, expected some time after 2003 when changes are made to the Broadcasting Act. "I think we will be continuing to lobby for a single ITV," he said.

To do that, Mr Allen will have to take on Michael Green, the founder and chairman of Carlton. Mr Green will have been relieved yesterday that Granada targeted United; earlier this month the Competition Commission gave Mr Allen and Mr Robinson carte blanche to pursue either rival.

What stopped a move on Carlton was the Commission's ruling that, for now, no one ITV company can own more than two of the top four franchises - Carlton TV, Central, LWT and Meridian - or both London licences. Had Mr Allen bid for Carlton, one London licence would have had to be sold.

Broadcasting Act rules limiting any ITV company to 15 per cent of national viewership mean that Granada Media will have to sell HTV, most likely to Carlton. "I phoned Michael Green this morning," Mr Allen said. "I think we'll talk about it next week."

When negotiations on HTV begin, Carlton's Mr Green will hold a strong bargaining chip - a 20 per cent interest in Meridian worth £180m that Granada is keen to buy. That and about £250m in cash would secure HTV for Carlton and complete - for now - the carve-up of ITV.

Mr Allen said the estimated £38m in annual savings from combining Granada Media and United would come from infrastructure rationalisation and lower transmission costs. "I don't see this as a job reduction exercise. We're looking at building businesses."

Lord Hollick will have been bitterly disappointed at the outcome of his attempt to become a major media player. Particularly galling is that the Labour peer's hopes were railroaded by the Government of which he has been so supportive.

The Government put Granada in the driving seat by demanding the sale of Meridian if it allowed the United/Carlton deal. Lord Hollick could be forgiven for feeling that being one of "Tony's cronies" should be more rewarding.

Instead of leading a major multimedia force, Lord Hollick, as United's chief executive, will be left running a company whose best known assets are the Express and Daily Star newspapers, a new media division, and a business services division covering business and technology magazines, information and trade exhibitions.

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
Money
Welcome to tinsel town: retailers such as Selfridges will be Santa's little helpers this Christmas, working hard to persuade shoppers to stock up on gifts
news
News
i100
News
people
Arts and Entertainment
Architect Frank Gehry is regarded by many as the most important architect of the modern era
arts + entsGehry has declared that 98 per cent of modern architecture is "s**t"
Arts and Entertainment
Soul singer Sam Smith cleared up at the Mobo awards this week
arts + entsSam Smith’s Mobo triumph is just the latest example of a trend
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Media

Head of Business Development and Analytics - TV

competitive benefits: Sauce Recruitment: Outstanding analytic expertise is req...

Head of ad sales international - Broadcast

competitive + bonus + benefits: Sauce Recruitment: Are you the king or Queen o...

Business Development Manager Content/Subscriptions

£50k + commission: Savvy Media Ltd: Great opportunity to work for a team that ...

Trainee Recruitment Consultant

£18000 - £30000 per annum + uncapped: SThree: Do you feel like your sales role...

Day In a Page

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker