ITV (LON:ITV) is considering entering into a £1-billion joint venture with the BBC by buying half of broadcaster UKTV, The Telegraph has reported. The potential deal could accelerate attempts to create a homegrown competitor to Netflix.
ITV’s share price has lost ground in London in today’s trading, having given up 2.34 percent to 164.01p as of 10:31 BST. The stock is underperforming the broader market selloff which has seen the benchmark FTSE 100 index give up 1.36 percent to 7,624.94 points so far today. The broadcaster’s shares have lost more than 18 percent of their value over the past year, as compared with about a one-percent rise in the Footsie.
ITV mulls over JV with the BBC
The Telegraph reported today that ITV was considering entering a joint venture with the BBC by buying half of UKTV. The newspaper noted that according to terms of the joint venture, the BBC has the right to buy out its partner at a set price before the end of next week. The window of opportunity to seal the partnership, however, will close within a fortnight.
UKTV, whose channels include Dave and Gold, is an independent commercial joint venture between BBC Worldwide and Discovery. The Telegraph further noted that Discovery was working on an alternative plan for breaking up UKTV, while the BBC had previously approached Sky (LON:SKY) as a potential partner in the joint venture.
Analysts on FTSE 100 broadcaster
The 21 analysts offering 12-month price targets for ITV for the Financial Times have a median target of 190.00p on the shares, with a high estimate of 265.00p and a low estimate of 110.00p. As of May 25, the consensus forecast amongst 21 polled investment analysts covering the blue-chip broadcaster has it that the company will outperform the market.