Sunday Times: Virgin Media to sell stake in UKTV

BigFoot87BigFoot87 Posts: 9,293
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http://www.marketwatch.com/story/virgin-media-to-sell-stake-in-uktv-report-2010-08-08?siteid=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A%20marketwatch%2Ffinancial%20%28MarketWatch.com%20-%20Financial%20Services%20Industry%20News%29
LONDON (MarketWatch) -- Virgin Media Inc. is selling its stake in the digital broadcasting business that it owns with the BBC, in a deal valued at at least GBP350 million, the Sunday Times reports without citing sources.

The business, called UKTV, consists of 10 channels. Proceeds will be used to pay down debt, according to the newspaper.

UBS and Goldman Sachs will begin looking for potential buyers in the coming weeks, the report adds.

Virgin Media representatives couldn't be immediately reached for comment.
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  • mlt11mlt11 Posts: 21,065
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    I can't provide a link but have the actual paper in front of me.

    It says BBC Worldwide is regarded as the "frontrunner" to acquire the stake (it already owns the other 50%).
  • CharnhamCharnham Posts: 61,157
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    would a 100% BBCWW (which is really just BBC) be allowe to have ad funded free to air channels.

    It seems like a conflict of interest, and a threat to the licecne fee.
  • zz9zz9 Posts: 10,767
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    Charnham wrote: »
    would a 100% BBCWW (which is really just BBC) be allowe to have ad funded free to air channels.

    It seems like a conflict of interest, and a threat to the licecne fee.

    Who knows? BBCW, and UKTV, are not subsidised by the licence fee, but profit they make goes back to the BBC.
    If they can allow BBCW to own 50% then why object to 100%?

    If UKTV and its channels disappeared then someone would buy the rights to repeat those shows. The BBC would still make that income, just not the profit of running the channels.

    Of course the clause that the other partner, VM at the moment, is responsable for all of any losses incurred would vanish. BBCW would then be liable for any losses should UKTV make any. Being a limited liability there is no chance that they could drag BBCW and the BBC down with huge losses. If they suddenly lost billions then BBCW could just walk away.
  • CharnhamCharnham Posts: 61,157
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    zz9 wrote: »
    Who knows? BBCW, and UKTV, are not subsidised by the licence fee, but profit they make goes back to the BBC.
    If they can allow BBCW to own 50% then why object to 100%?
    I still think its dodgy that the BBC would be allow to full own & run ad funded channels,I am amazed that ITV has not questioned this already.

    Also BBCWW is starting to provide funding shows with the BBC, would for example a BBC 4 / Yesterday production be allowed? Seems to me that BBC 4 would be using money from advertising to fund the show.

    I dont think this is an evil plan by the BBC, but it should not be seen to be taking money from the advertising pot. BBCWW is just not that far removed from the BBC.
  • mad_dudemad_dude Posts: 10,670
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    being wholly owned by a broadcaster interested in promoting FTA television and not co-owned by a pay TV gatekeeper could be very good for freeview and Freesat homes.
  • CharnhamCharnham Posts: 61,157
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    mad_dude wrote: »
    being wholly owned by a broadcaster interested in promoting FTA television and not co-owned by a pay TV gatekeeper could be very good for freeview and Freesat homes.
    in that case I hope C4 buy it, or worst case ITV,
  • Pablo DiabloPablo Diablo Posts: 5,892
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    At least selling VMTV made sense. This is just stupid.
  • mad_dudemad_dude Posts: 10,670
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    Charnham wrote: »
    in that case I hope C4 buy it, or worst case ITV,

    ITV would be the best broadcaster in this case. they have their own extensive archive that could be used quite effectively on a 'gold' type channel.

    Slightly OT but if ITV had a part ownership of BBC worldwide. It might encourage them to produce higher quality productions that are exportable overseas. They lack the infrastructure at the moment to exibit their content worldwide.
  • CharnhamCharnham Posts: 61,157
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    mad_dude wrote: »
    ITV would be the best broadcaster in this case. they have their own extensive archive that could be used quite effectively on a 'gold' type channel.
    but what does ITV have to gain, it could just air those programs on ITV 3, or ITV 4?
    mad_dude wrote: »
    Slightly OT but if ITV had a part ownership of BBC worldwide. It might encourage them to produce higher quality productions that are exportable overseas. They lack the infrastructure at the moment to exibit their content worldwide.
    it could help them, Primeval shows that it can be done.
  • Hankers R DSHankers R DS Posts: 590
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    Charnham wrote: »
    I still think its dodgy that the BBC would be allow to full own & run ad funded channels,I am amazed that ITV has not questioned this already.

    Also BBCWW is starting to provide funding shows with the BBC, would for example a BBC 4 / Yesterday production be allowed? Seems to me that BBC 4 would be using money from advertising to fund the show.

    I dont think this is an evil plan by the BBC, but it should not be seen to be taking money from the advertising pot. BBCWW is just not that far removed from the BBC.

    But they are not primarily funded by ads, they receive money via the subscriptions charges that Sky make.
  • CharnhamCharnham Posts: 61,157
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    But they are not primarily funded by ads, they receive money via the subscriptions charges that Sky make.
    not sure why BBC WW would get alot of money from Sky for Dave or Yesterday given that both are freely avabile on Freeview, and have been for a while.
  • mossy2103mossy2103 Posts: 84,307
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    Charnham wrote: »
    I still think its dodgy that the BBC would be allow to full own & run ad funded channels,.
    BBC Worldwide would be running them though. It would be little different from the way that it runs BBC America.

    And in essence, the whole setup would be little different from the way that overseas collaborations are set up and produced.


    Anyway, I understood that BBCWW already had first refusal on any stake sale, and that it also had final say as regards who buys any stake (so as to keep the aims & ideals of the BBC).

    With that in mind, which other broadcaster/media groups would make acceptable partners?
  • CharnhamCharnham Posts: 61,157
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    ITV & C4 would be the two best bets I guess.

    I am thinking this wont attract international bidders
  • mossy2103mossy2103 Posts: 84,307
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    Charnham wrote: »
    ITV & C4 would be the two best bets I guess.
    Maybe C4 then, as i am not sure that ITV would be seen to be a suitable partner).
    I am thinking this wont attract international bidders
    What about any of the existing US/Canadian outfits that already are in partnership with BBCWW on other TV productions?
  • CharnhamCharnham Posts: 61,157
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    mossy2103 wrote: »
    What about any of the existing US/Canadian outfits that already are in partnership with BBCWW on other TV productions?
    such as?

    If HBO had not signed that deal with Sky, I might have said them.

    PBS, does not seem to match what I know about them, depsite them working with the BBC a fair amount.
  • mossy2103mossy2103 Posts: 84,307
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    Charnham wrote: »
    such as?

    If HBO had not signed that deal with Sky, I might have said them.

    PBS, does not seem to match what I know about them, depsite them working with the BBC a fair amount.
    Startz is one that springs to mind at the moment,. only by way of its involvement with Torchwood 4
  • [Deleted User][Deleted User] Posts: 195
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    The only realistic buyers for the 50% of UKTV owned by VM are BBC WW themselves or C4. And even then, I imagine BBC WW would much prefer to buy it themselves. They are in rude health and certainly have the funds to easily do it, and, as previously mentioned, hold the trump card of being able to veto any other buyer VM line up.
    The previous government were keen for C4 to get involved with BBC WW, so I think the only way BBC WW would step aside to allow C4 to buy it would be because it has been ordered from very high up.
    At least selling VMTV made sense. This is just stupid.

    Why? They do not run the channels, make a pittance from them each year (a few million pounds), and pretty much have no involvement in the channels whatsoever. They are completely run by BBC WW. The resctrictive ownership clauses held by BBC WW mean UKTV could not be considered a strategic investment as they have virtually no say over who they could sell their share to or how the channels could be used to further their own gains (ie. as bargaining chips in negotiations with Sky or as exclusives to their own platform).
    If anything, VMTV could at least have been considered a strategic investment in that sense - they had full control over some valuable TV property.
    Rightly or wrongly, VM say they have no interest in owning content any more so UKTV has to go.
  • BigOrangeBigOrange Posts: 59,653
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    I don't understand how their stake in UKTV could be worth as much as £350m.

    Five has just been sold for £100m, before that VMTV was sold to BSkyB for £160m.

    How on earth could a 50% stake in UKTV be worth so much in comparison?

    Five has a 6.1% viewing share across 5 channels.

    Virgin had a 2.6% viewing share across 11 channels.

    UKTV has a 4.3% viewing share across 18 channels.

    Obviously both Virgin and UKTV benefit from having a secondary revenue source that Five currently does not have (pay TV in addition to ad revenue) but I still don't see how a 50% stake in UKTV could be worth so much more than Virgin as a whole.
  • IanPIanP Posts: 3,661
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    The value of Five plummeted as it became loss making.
  • CharnhamCharnham Posts: 61,157
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    mossy2103 wrote: »
    Startz is one that springs to mind at the moment,. only by way of its involvement with Torchwood 4
    1 TV show is hardly a reason to buy into BBCWW, it has what it wants from the BBC already, a co-prodution deal.

    Also UK TV is a group of channels as much as anything else, why would Starz want some UK TV channels?
  • mossy2103mossy2103 Posts: 84,307
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    Charnham wrote: »
    1 TV show has hardly a reason to buy into BBCWW, it has what it wants from the BBC already, a cop-prodution deal.

    Also UK TV is a group of channels as much as anything else, why would Starz want some UK TV channels?
    True.

    So really then, it's C4 or BBCWW (unless there is *cough* pressure applied from Government circles for another broadcaster to be allowed consideration *cough*
  • CharnhamCharnham Posts: 61,157
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    mossy2103 wrote: »
    True.

    So really then, it's C4 or BBCWW (unless there is *cough* pressure applied from Government circles for another broadcaster to be allowed consideration *cough*
    the government would more likley pressure the BBC to sell off all of BBC WW, or possibly the UKTV channels.

    Going back a bit, I do think it wrong that the BBC could keep 100% of the profits generated by a free to air ad supported channel like Dave. I am amazed that ITV is not making this point, as it would be a case of the BBC making money from advertising.

    I know many here want East Enders axed, but would settle for the licene fee no longer paying for it, would we really all be happy if EE became ad funded on a BBC WW free to air channel?
  • mossy2103mossy2103 Posts: 84,307
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    Charnham wrote: »
    I know many here want East Enders axed, but would settle for the licene fee no longer paying for it, would we really all be happy if EE became ad funded on a BBC WW free to air channel?
    The same argument applies here as applies to the BBC taking advertising instead of the LF (discussed on many other more suitable threads) - the programmes would be made to attract and please the advertisers, and such a high-profile programme would divert ad revenue away from other commercial channels.
    Going back a bit, I do think it wrong that the BBC could keep 100% of the profits generated by a free to air ad supported channel like Dave
    Gets a bit complicated when Dave buys in stuff from other broadcasters such as Five (soon to be Channel five) such as Fifth Gear, The Gadget Show, thus assisting their profits, and when it financed part of the cost for Primeval, whilst not having first or maybe even second refusal on it
  • CharnhamCharnham Posts: 61,157
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    mossy2103 wrote: »
    The same argument applies here as applies to the BBC taking advertising instead of the LF (discussed on many other more suitable threads) - the programmes would be made to attract and please the advertisers, and such a high-profile programme would divert ad revenue away from other commercial channels.
    if Dave was fully owned by the BBC, it is hard to suggest the that BBC is funded with both the licence fee, and the adverts on Dave & Yesterday.

    Both channel are fine, but the BBC really should not be so quick to give the impression it runs ad funded channels, that compete with the other free to air boradcasters for advertising.
  • CharnhamCharnham Posts: 61,157
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    mossy2103 wrote: »
    Gets a bit complicated when Dave buys in stuff from other broadcasters such as Five (soon to be Channel five) such as Fifth Gear, The Gadget Show, thus assisting their profits, and when it financed part of the cost for Primeval, whilst not having first or maybe even second refusal on it
    this is of course true, but it still is leavng the BBC wide open to attack,

    Dave airing The Gadget Show could be spun as "BBC profits from the TV shows of other channels"
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