ITV merger given green light

8 Oct 2003

The UK Trade and Industry Secretary Patricia Hewitt yesterday gave the go ahead for ITV franchisees Granada and Carlton Communications to press ahead with their long-held plans to merge on the condition that the two companies agree to a series of safeguards limiting their control over the commercial TV advertising market. Speculation had mounted in the past few days that the government would impose much stricter conditions on the proposed tie-up, including ordering the two broadcasters to sell off their advertising sales departments. However, according to yesterday’s announcement, the only safeguard placed on the deal is that Carlton and Granada must adhere to a system of ‘contract rights renewals’, under which the prices charged for advertising slots will be closely monitored by an independent watchdog. The finer minutiae of the system will be thrashed out between the broadcasters and the Office of Fair Trading at the end of October, with the full merger expected to take place in January 2004. News of the deal was welcomed by the investment community, with Granada’s shares rising by 9% to GBP1.13 and Carlton’s by 13% to GBP2.05.

United Kingdom