US channel operator Scripps Networks Interactive has inked a deal to acquire Virgin Media’s 50% stake in UKTV.
Scripps will pay £239 million (US$390 million) for Virgin Media’s equity share in the British channel operator and a further £100 million for the outstanding preferred shares and debt owned by UKTV to Virgin Media.
The deal comes as UKTV expands the volume of local production across its channels and is significantly stepping up its acquisitions of first-run content from the Hollywood studios, such as last year’s deal with Disney for crime drama Body of Proof.
BBC Worldwide will retain its 50% stake in UKTV. Scripps and BBC Worldwide are negotiating a deal whereby the latter would have the option, after completion to increase its stake to 60% via a combination of cash and contributing a package of digital rights for UKTV. Scripps’ voting rights and board representation would not be affected by the deal, which would be subject to approval by the BBC Executive and Trust.
UKTV operates channels Home, Good Food, Dave, Watch, GOLD, Alibi, Eden, Blighty, Yesterday and Really, available via the Sky Digital and Virgin Media platforms. Completion of the deal is dependent on regulatory approval in Ireland and Jersey.
BBC Worldwide CEO John Smith said the “new agreement we are developing will bring benefits to UKTV’s audiences in the way they can consume content and will help to sustain UKTV’s track record of growth. It will create the opportunity to drive further value from digital rights on behalf of our stakeholders, particularly our shareholder, the BBC.”
“UKTV is a significant opportunity for Scripps Networks Interactive to participate in a thriving multi-channel, dual revenue stream media business in one of the world’s largest television markets,” said Kenneth Lowe, chairman, president and CEO of Scripps Networks Interactive. “Making a solid investment in UKTV and entering into a strong partnership with BBC Worldwide reinforces our core international strategy which we believe will create significant long-term value for our shareholders.”