Carlton Move Set To Provoke Bids
The move by Carlton at the weekend to acquire Westcountry TV is predicted to provoke a flurry of bids within the TV sector. Other ITV takeover targets are expected to be HTV, YTTV (Channel 3 North East and Yorkshire combined) and two of the Scottish franchises, Border and Grampian.
United News & Media is the favourite to bid for HTV since it recently acquired a 20% stake in the company *STV Sells Stakes In HTV And ITN, though it is possible that Carlton is also a suitor. Under the new cross media ownership rules which came into being on November 1 *New Media Ownership Rules Become Law, ITV companies can now have as many interests in other broadcasters as they like as long as their acquisitions combined do not have more than a 15% share of the total viewing audience: for a stake to register as an “interest”, it must be more than 20% and then half the acquired’s viewing share must be added to the stakeholder’s.
As Chart 1 below shows, the acquisition of Westcountry by Carlton Communications, which in addition has qualifying stakes in Carlton TV and Central TV, has increased its total terrestrial audience share by 0.95% to 10% while Granada, which has qualifying stakes in YTTV (Channel 3 North East and Yorkshire TV), Granada TV and LWT has 9%. UNM is a relatively small player amongst these two with its qualifying stakes in Anglia and Meridian giving it a total terrestrial viewing share of 4%.
Chart 1:
The acquisition by Carlton of HTV would therefore give it a 13% share while UNM’s share would increase to 7% if it was taken over. Granada’s terrestrial share would increase to almost 12% if it acquired the rest of YTTV as is predicted, while STV’s share would only increase to 3% if it took over Grampian.
Chart 2 shows the ITV companies which are at the centre of bid speculation.
Chart 2: yellow=Laser green=TSMS red=Carlton UK Sales
In terms of sales houses, Chart 3 shows that Carlton UK Sales actually controls the least ITV viewing share while Laser and TSMS have roughly equal amounts. This situation would change very little if the rumoured takeovers take place – since Granada’s Laser already sells airtime for YTTV and United’s TSMS sells for HTV. However, if Carlton again managed to outdo United and gain control of HTV, its saleshouse’s share of ITV viewing would overtake Laser’s and reach 37%.
Sales House Clients
| ITV Viewing Share | |
|---|---|
| TSMS | |
| Anglia | 6 |
| Grampian | 2 |
| HTV | 8 |
| STV | 7 |
| Ulster | 3 |
| Meridian | 8 |
| Laser | |
| C3 North East | 5 |
| Granada | 12 |
| Border | 2 |
| LWT | 7 |
| Yorkshire | 11 |
| Carlton UK Sales | |
| Carlton | 9 |
| Central | 17 |
| Westcountry | 3 |
Chart 3:
Shareprices in the sector continued to rise and at 9:30 this morning reflected City expectations of who would be on the lookout for acquisitions, with Granada up 2 to 880p and Carlton up 5 to 518.5p. YTTV increased by 5 to 1305p while HTV remained at yesterday’s close of 356.5p.
* MediaTel subscribers only