ITV Digital To Restructure; Merger Talks Revived?

Carlton and Granada have issued a statement saying that “a fundamental restructuring of ITV Digital’s cost base must be concluded as a matter of urgency in order to secure the long term future of the business” and that Deloitte & Touche have been appointed to help in this task.

ITV Digital remains some way behind its rival BSkyB in terms of subscribers (see ITV Digital Reaches 1.26m Subscribers), and financial results from the co-owners have revealed spiralling costs (see ITV Digital Losses Weigh Heavy On Granada). Despite creating a substantial media noise with its revamp, which introduced the Al and Monkey characters to the public consciousness (see Comedy Duo Front ONdigital Rebrand), the platform suffered last year from increasingly loud murmurs of misgivings from shareholders (see Zenith Slams ITV Digital).

The news comes amid rumours that a revival of merger talks between the two ITV giants could be on the cards despite a statement this morning saying that they had been called off (see Carlton And Granada End Merger Talks).

Both companies had seen share prices buoyed in the last couple of days by a renewed confidence in media shares. Following a shaky morning after the statement about the end of merger talks, Granada had risen by 3.30pm by 6źp or 5.5% to £1.19ž. Meanwhile Carlton had fallen 4źp or 1.86% on its previous closing price to £2.23ž by the same point in the afternoon.

Carlton: 020 7663 6363 www.carlton.com Granada: 020 7620 1620 www.granada.co.uk

Recent Financial stories on NewsLine: RIM Exceeds Expectations But 2002 “Remains Uncertain” Sorrell Eyes Leagas Delaney Pearson Puts FT Business Up For Sale

Subscribers can access ten years of media news and analysis in the Archive