STV Studios takes majority stake in ‘Blue Lights’ producer Two Cities

Blue Lights (BBC)

Scotland’s STV Studios has increased its stake in Blue Lights and Patrick Melrose producer Two Cities Television to become majority shareholder.

STV took a 25% stake in the Michael Jackson and Stephen Wright-led company four years ago and has now taken up an option to increase that to a 51% position in the company, which was founded in 2016.

The option was contingent on Two Cities becoming profitable and the company is now projecting revenues of £55m ($70m) between 2024 and 2026.

Patrick Melrose

A second season of Blue Lights is on the slate, along with “a strong development pipeline”, but delivery schedules for commissioned shows have not been finalised, meaning the “phasing of profit” across the three years is not yet agreed.

STV has acquired its increased stake from the shareholdings held by Two Cities management.

Two Cities was launched by former Channel 4 CEO and Universal Television chairman Jackson seven years ago, alongside creative director Wright, who was formerly head of drama for BBC Northern Ireland.

BBC Studios had initially invested in the business, selling its stake when STV invested in 2020.

For STV Studios, the deal marks another investment as it attempts to become a 10% operating margin business and follows the $27m deal to acquire Greenbird Media from Keshet International last summer.

Michael Jackson

It now owns 24 creative labels producing almost 40 returning series, ranging from AppleTV+ drama Criminal Record to A&E’s After Dark and Lego Masters.

Wright and Jackson said: “The company is beginning to find its feet and we are thankful for all the support from STV Studios in getting Two Cities up and running. Their continued investment and partnership will allow us to develop and grow.”

Simon Pitts, CEO of STV Group, added: “Michael and Stephen have delivered significant creative and commercial success on the back of the standout performance of Blue Lights and there is so much more to come.

“STV’s consolidation of Two Cities is clear evidence of the ongoing success of our studios strategy of taking minority stakes in high potential production companies.”

Tom Manwaring’s Helion Partners advised Two Cities on the latest STV deal and its initial investment.