US TV Company Scripps Networks Snaps Up U.K. Pay TV Operator UKTV Stake
LONDON – U.S. TV company Scripps Networks has bought Virgin Media’s 50 percent stake in pay TV operator UKTV in a £339 million ($552 million) deal.
Scripps – which owns U.S. TV brands including The Cooking Channel and The DIY Network – paid £239 million ($389 million) in cash, and will pay a further £100 million ($163 million) to acquire the outstanding preferred stock and debt owed by UKTV to Virgin Media.
UKTV is the pay TV business formed in 1997 as a 50-50 joint venture with BBC Worldwide, and is home to a portfolio of 10 pay TV channels including Gold, Dave, Home, Watch, Yesterday and Good Food.
"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 chairman, president and chief executive Kenneth 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."
Following the completion of the deal, which requires regulatory approval in the Republic of Ireland and Jersey, SNI is negotiating a deal to give BBC Worldwide the option of increasing its stake to a maximum of 60 percent, by using a combination of cash and an unspecified "package of digital rights" for UKTV, the market was told.
"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," said BBC Worldwide chief executive John Smith. "It will create the opportunity to drive further value from digital rights on behalf of our stakeholders, particularly our shareholder, the BBC."
In 2009, Scripps launched The Food Network in the U.K. and Europe, home to shows including Nigella Express and Great British Menu, in partnership with Chello Zone.