UBM Considers Sale Of Stake In Five

Speculative reports this morning suggest that United Business Media could off-load its 35% stake in Five before the departure of outgoing chief executive Lord Hollick in May, despite optimistic financial results released by the broadcaster last week.

Lord Hollick, currently embroiled in the sell-off of research specialist NOP world, is reportedly enthusiastic about withdrawing UBM’s interest in Five, which last week announced that it had doubled its profits to €18 million in the 12 months to December 2004 (see Five Doubles Profits As Ad Revenue Rises).

The growth in Five’s fortunes is due mainly to strong growth in the advertising market, although the broadcaster has also been buoyed by strong ratings from American film imports and drama series. Amongst the channel’s recent successes were Crime Scene Investigation and CSI New York, while the recently acquired Joey managed to break the channel’s non-film and sporting content viewing records last month (see Joey Breaks Five’s Viewing Records With 4.1 Million).

Any sale of UBM’s share of the broadcaster would require Five’s parent company, RTL, to be given first refusal for a purchase. The German company is understood to be committed to Five, with chief executive Gerhard Zeiler weighing up a bid for the remaining 35% share, the value of which is believed to be around £200 million.

However, RTL may not be the only interested party if UBM’s stake goes under the hammer, with Telewest having considered a tie-up with the broadcaster last year, following the collapse of Five’s merger talks with Channel 4 in November (see Five Looks To Flextech Merger To Secure Future).

A purchase of UBM’s stake could put investors in good stead, as the broadcaster clearly has no intention of remaining static over the coming months. Five has already mulled over the launch of digital spin-off channels, such as Milkshake, it’s children’s TV strand (see Five Eyes Expansion With Digital Children’s Channel), and last year increased the programming budget of its main channel by £17 million in an effort to increase its overall viewing share (see Five Boosts Programme Budget By £17 Million).

Five: 020 7550 5555 www.five.tv UBM: 020 7921 5000: www.unitedbusinessmedia.com

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