ITV in early talks with Sky over sale of Media and Entertainment unit

ITV said on Friday it is in early-stage talks with Sky, the European pay-TV business owned by Comcast, over a possible sale of its Media and Entertainment division for an enterprise value of 1.6 billion pounds, equivalent to about 2.1 billion dollars. The discussions were described as preliminary and were disclosed in a statement to the stock exchange, with the broadcaster stressing there is no certainty a transaction will be agreed.

The Media and Entertainment unit under discussion comprises ITV’s commercial free-to-air television channels in the United Kingdom and its streaming service ITVX. The company said the proposed sale would not include ITV Studios, its production arm that makes programmes such as Love Island and other high-profile shows. ITV’s statement added, "There can be no certainty as to the terms upon which any potential sale may be agreed or whether any transaction will take place. A further announcement will be made in due course if appropriate."

The disclosures follow a period of cost pressures at ITV. The broadcaster recently announced temporary budget reductions and programming changes in response to a softening advertising market, measures that have...