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BBC, C4 linked to $650m UKTV bid

UK pubcasters the BBC and Channel 4 are reportedly eyeing up a £500m (US$650m) joint deal to take full control of multichannel operator UKTV, which is behind networks including Dave and Gold.

BBC Studios (fka BBC Worldwide) already holds a 50% stake in UKTV, with the other half held by Discovery Communications, which acquired the stake as part of its US$14.6bn deal for Scripps Networks Interactive in March.

Since then, the BBC has been exploring the possibility of increasing its stake in the company, which operates 10 free-to-air networks and pay channels plus an on-demand service.

It is unable to finance the move on its own, however, leading to the potential of a joint bid between the BBC and C4, according to UK newspaper the Guardian.

In May, fellow UK paper The Telegraph claimed ITV was considering linking up with the BBC to make a joint US$1.3bn bid to buy out Discovery’s 50% stake.

The BBC had already approached pay TV giant Sky about a potential pact to buy out Discovery’s stake, but the talks did not move forward, according to UK newspaper.

Previous reports suggested Discovery had also been working on an alternative plan to break up UKTV, although that idea is now believed to have been shelved.

UKTV is a substantial source of revenue for the BBC, with the channels operator returning part of its profits to the UK pubcaster and licensing an array of BBC Studios programming such as Top Gear.

C4, meanwhile, also relies on UKTV to run its advertising operation, while the deal would also provide the smaller UK pubcaster with an additional revenue stream.

UKTV has become increasingly profitable over recent years, making £91m in 2017. It has also been expanding its originals output, ordering its first drama for entertainment channel W and hiring a former exec from UK prodco Hartswood West as its first drama commissioner.

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