ITV shares jump on reports it could sell stake in production arm

Banijay NV

17/10/2022 08:47

LONDON, Oct 17 (Reuters) - Shares in ITV  ITV.L  jumped
7% in early deals on Monday, lifted by a Financial Times report
that it is considering selling a stake its production arm ITV
Studios.
    Britain's biggest free-to-air commercial broadcaster has
recently fielded expressions of interest in ITV Studios, the
report said citing people familiar with the discussions.
    ITV Studios makes programmes such as "Love Island" and
"Coronation Street" and is one of the largest producers in
Europe. Some analysts say the business could be worth more than
its parent company's 2.5 billion pound ($2.82 billion) market
capitalisation. 
    Shares in ITV rose to 66 pence at 0738 GMT, reaching levels
last seen in September. The stock is down 40% this year.
    Chief executive Carolyn McCall has complained that the value
of ITV Studios was not reflected in the group's share price, and
the newspaper said that was why the group was looking at options
to help recognise that value. 
    Citi analysts said on Monday that selling a stake in ITV
Studios would make sense. 
    "If the company could find a way of changing perceptions of
the value of the ITV Studios business this could be meaningfully
accretive to valuation," they said. 
    Potential buyers include private equity groups and other
large independent producers such as Bertelsmann's Freemantle or
FL Entertainment, the parent company of Banijay, the newspaper
added.
    An ITV spokesperson declined to comment on the FT report on
Sunday.
 ($1 = 0.8880 pounds)
 (Reporting by Sarah Young; Editing by Alex Richardson)
 ((sarah.young@thomsonreuters.com; +44 20 7542 1109; Reuters
Messaging: sarah.young.thomsonreuters@reuters.net))