Channel 4 Auction Could Scupper Five Merger
Any potential merger plans being drawn up between Channel 4 and Five could be derailed if the Government insists on the state-owned broadcaster being auctioned off to the highest bidder.
A Government source, quoted by The Business, stated: “It’s difficult to conceive of a way in which you could privatise a public corporation without some sort of open tender process.”
Last month Channel 4 chief executive, Mark Thompson, confirmed that merger talks had taken place between the two broadcasters and that Channel 4’s board of directors had been asked to appoint financial advisers to explore the logistics of a potential deal (see Channel 4 Confirms Merger Discussions With Five).
Channel 4 is a public corporation and any change to its ownership would need to be sanctioned by law. The broadcaster has no shareholders and is effectively Government property, worth approximately £2 billion.
Broadcasting minister, Lord McIntosh, told The Business that he would be “surprised” by any changes in law made to end Channel 4’s status as a public corporation.
Ofcom has distanced itself from the debate surrounding the broadcaster’s future. A spokeswoman for the communications watchdog said: “If Channel 4 wants to consider its future, that’s for it to decide. We would only get involved if there was a change in primary legislation and if the Secretary of State for Trade and Industry decided that it was in the public interest.”
ITV has also reportedly stated interest in buying Channel 4, a prospect which, while dismissed by many at the time, now looks increasingly viable should the Government insist on a competitive auction (see ITV Could Bid For Channel 4 In Run Up To Merger With Five).
Channel Four: 020 7396 4444 www.channel4.com Five: 020 7550 5555 www.five.tv ITV: 020 7843 8000 www.itv.com
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