ITV to sell Freeview slots business SDN

ITV is considering plans to sell its Freeview multiplex operating business SDN in a bid to save cash and focus on its core broadcast and television production business.

ITV’s executive chairman Michael Grade has been evaluating a range of money-saving options ahead of the commercial broadcaster’s annual results next week, according to reports.

The potential sale of SDN, which ITV bought for £134 million in 2005, is expected to be one option, however, others could include scrapping the dividend and launching a rights issue to raise £300 million from investors.

SDN is a profitable business that owns and rents Freeview channel slots to broadcasters, such as Five, Discovery and QVC – and is thought to be worth around £200 million.

Reports suggest that the most likely buyer is broadcast services business Arquiva, which bought ITV’s 70% stake in spectrum management company JFMG for £1 million cash last week.

Speculation over the sale of SDN comes just a week after ITV reportedly put social networking site Friends Reunited up for sale in a bid to scale back costs (see ITV to sell Friends Reunited).

The broadcaster paid £120 million for the online friend-finding site in 2005, which has since struggled due to the rise and popularity of similar but free community sites such as Facebook and MySpace, and as a result is now thought to be worth just £20 – £40 million.

ITV’s cost-cutting plans, which has also led to redundancies and programmes being cancelled, seems to have sparked a dismal run for the broadcaster’s share price on the London Stock Exchange.

It closed at a new low of 24.5p on Friday, down by more than 10.9% over the space of one week.