US Broadcasting giant Discovery Inc (Nasdaq: DISCA) is in talks to potentially take over Britain’s state-owned public service channel network, Channel 4 Television Corporation.
The UK government is also holding informal discussions with broadcasters ITV Plc and Comcast Corporation’s Sky and does not expect to close a deal until mid-2022, The Telegraph reported on Saturday.
Discovery has not commented on the newspaper’s report.
It comes a few weeks after the UK Department for Digital, Culture, Media and Sport launched a 10-week consultation to review Channel 4’s ownership structure and explore a potential sale.
Amid concerns over increased competition and changing viewership habits, officials have said they believe private-sector ownership could help the broadcaster tap new capital and diversify its income streams to build a more resilient financial base.
Launched in 1982, Channel 4 is a publicly owned, non-profit that is funded entirely through commercial activity. Its content is commissioned from over 300 UK-based independent production companies and includes shows like “The Great British Bakeoff.”
In a recent statement, Oliver Dowden, UK Secretary of State for Digital, Culture, Media and Sport, said, “The media world has changed immeasurably since Channel 4’s creation in the early 1980s, but whilst we have more choice today the need for a strong and successful Channel 4 continues.”
“In the face of rising global competition, now is the right time to strengthen UK public service broadcasters and consider releasing Channel 4 from the constraints of public ownership, enabling it to thrive for the next 40 years and beyond,” Dowden said.
S&P Global noted that the sale could be a good opportunity for a large US buyer if strict rules regulating the public service broadcaster are loosened.
Several groups have already said they oppose a potential sale of Channel 4, saying it would damage small businesses during a time of recovery and rebuilding after the pandemic.
John McVay, chief executive officer of Pact, a UK trade association that represents independent production and distribution companies, said, “The channel is a thriving dynamic and successful public service broadcaster and a catalyst for generations of entrepreneurs.”
“The current government’s thesis that bigger is always better is an archaic concept from an analogue past,” he added
British comic and actor Ricky Gervais also spoke out, saying he believes Channel 4’s remit would be “destroyed” if it were privatized and a “real shame” if ministers pushed ahead with the plans.
Source: Equities News