ITV to sell media and entertainment business to Sky for up to £1.6bn

(Sharecast News) - ITV said on Monday that it has agreed to sell its media and entertainment business to Comcast-owned Sky for up to �1.6bn.

Sky will pay �1.2bn in cash at completion. There will also be a contribution of Sky's Love Productions business for an agreed enterprise value of �200m, and a contingent cash consideration of up to �200m payable in the second half of 2028. The latter is subject to total advertising revenue performance in FY 2027 and certain trading balance adjustments.

ITV said the deal will enable a cash return to shareholders of around �950m - 25p per share - excluding any contingent consideration.

Following Comcast's planned separation, Sky and ITV's M&E business are expected to form part of NBCUniversal upon completion of both transactions.

Chairman Andrew Cosslett said: "At a headline value of up to �1.6bn, the sale of ITV's M&E division will deliver a significant cash return to shareholders. Crucially, the transaction also unlocks the value of ITV Studios which post completion will be a distinctive pure-play global content business, with a strong track record of success and excellent prospects, further underpinned by a long-term partnership with ITV M&E and Sky."

Sky chief executive Dana Strong said: "This is a defining moment for British media and an opportunity to build a stronger future for two of the UK's most loved and trusted brands. We have huge respect for the transformation the ITV team has delivered, particularly its successful move into streaming through ITVX, which has brought fantastic British content to millions of viewers across the UK.

"Bringing Sky and ITV Media & Entertainment together combines the very best of free-to-air television, pay TV and streaming, ensuring viewers across the UK continue to enjoy outstanding British programming in a rapidly changing world."

See latest RNS on Investegate