Scottish Media Poised To Bid For GMTV

The Scottish Media Group confirmed today that it is about to make a bid for GMTV. The group, which owns Scottish Television and The Herald, already has a 20% stake in the commercial breakfast television company but released a statement today stating that it has tabled proposals with other GMTV shareholders.

These include the Guardian Media Group which owns a 20% stake and Walt Disney which holds a stake worth 25%. Both are believed to have been approached by Scottish Media with regard to their stakes but no plans have been confirmed. The other main shareholders are Carlton Communications and the Granada Group plc.

If deals with the Guardian and Walt Disney are successful the Scottish Media Group will have 60% control of GMTV. Such a stake will effectively put Scottish Media out of the reaches of the Granada group which last week was rumoured to be interested in buying out the company (see Sharewatch). As government regulations put the amount of airtime sales available for control by any one ITV company at 25%, Granada would be unable to successfully buy out the whole company if Scottish Media took control of GMTV.

Despite numerous losses in GMTV’s history, the group had its licence fee payments lowered by the ITC last year and since then the group has gained in strength and is this year expected to make pre-tax profits of £10 million. The deal is expected to be worth £130 million.

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