The long-awaited sale of news provider Independent Television News to a consortium led by Carlton Communications was completed Nov. 27.
Loss-making ITN was owned by the 14 regional broadcasters in the ITV web. Five of these are members of the Carlton consortium, which also includes news agency Reuters. Carlton is due to take over the London Weekday broadcasting franchise from Thames TV in the new year.
Revised terms had been accepted earlier in the week by ITN’s major shareholders, giving Carlton acceptances representing 74.7% of the stock. Among those giving their approval were Thames TV, TVS and TSW, which are leaving the network at the end of this year.
But for the sale to go through, 75% acceptances were needed and it is believed that at least two of the companies that had resisted the deal–among them Yorkshire-Tyne Tees, HTV, Ulster, Grampian and Border–relented toward the end of last week, causing the others to follow suit.
The Carlton consortium’s original offer of T1 per share valued ITN at just $ 600,000. This was rejected.
Granada, Scottish TV and Anglia then joined the consortium and the outgoing ITV members — Thames, TVS and TSW — were offered T14 per share for their stakes.
The new owners of ITN are committed to investing $ 45 million in the service, which has the exclusive contract to provide national news for the ITV web and Channel 4.
Although ITN’s news operations are profitable, it is losing about $ 7.6 million a year, largely as a result of a move to expensive new premises that are far too big for the company’s needs.
It was expected that the surplus space would generate rental income for ITN, but the recession has led to a glut of empty office space in London and no takers for the glitzy new offices have been found.
At long last
Last week’s deal has broken the logjam that for most of this year has prevented ITN from sorting out these problems.
Shareholders such as Yorkshire, who paid very high prices for the renewal of their franchises, are understood to have put pressure on ITN to drastically reduce costs.
Those who won their franchises with low bids, such as Central, are believed to have argued for the maintenance of the quality of the news service.
This will not be the last restructure of ITN, however. Government regulations require that at least 51% of the company be owned by non-ITV members by the end of 1994.
Carlton boss Michael Green will be ITN’s new chairman.