Scripps Network Interactive (SNI) is jumping into British cable TV in a big way, paying about $554.6 million to acquire half of UKTV from Virgin Media. BBC Worldwide will continue as the other partner in the venture.
SNI is paying 239 million pounds ($391 million) to acquire Virgin’s 50% equity interest in UKTV. It will also pay about 100 million pounds ($163.6 million) to acquire the outstanding preferred stock and debt owed by UKTV to Virgin. The deal is subject to regulatory approvals in the Republic of Ireland and Jersey.
“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 SNI CEO Ken Lowe. “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.”
SNI and BBC Worldwide said they are negotiating an agreement whereby, after completion, BBC Worldwide would have the option, via a combination of cash and a package of digital rights for UKTV, to increase its shareholding from 50% to a maximum of 60%. SNI’s existing voting rights and board representation would be unaffected by this proposed arrangement, which would be subject to BBC Executive and BBC Trust approvals.
Formed in 1997, UKTV attracts about 36 million viewers a month across its portfolio of 10 lifestyle, entertainment and non-fiction (factual) programming channels. UKTV brands include Home, Good Food (logo shown), Dave, Watch, GOLD, Alibi, Eden, Blighty, Yesterday and Really. UKTV also operates complementary websites for each channel brand.
UKTV channels air programming from the BBC and its own original programming. All of the UKTV channels are available on Sky Digital and Virgin Media. Dave and Yesterday also are available on Freeview.
“The launch of UKTV in 1997 created a new secondary platform for content from the BBC and UK independents that has delivered great value back to all stakeholders. We thank Virgin Media for the part it has played in developing the business into one of the most successful pay TV companies in the UK,” said John Smith, chief executive, BBC Worldwide.
“We welcome Scripps Networks Interactive as our new partner and look forward to working with them to open up further avenues to success. 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,” Smith added.
RBR-TVBR observation: Certainly a good fit when you look at the types of lifestyle and do-it-yourself channels that SNI operates in the US. No doubt there are opportunities ahead for exchanges of programming and/or show formats.