ITV in merger talks to form £3bn creative powerhouse listed on London market

Plans are advancing to form a new £3 billion British TV production powerhouse between ITV and All3Media.

The hope is to create a new company to be listed on the London Stock Exchange.

A deal is still far from certain, but if it did come off it would be a major boost for the UK stock market and for the creative industries in this country.

Carolyn McCall, the chief executive of ITV, has been in discussions for some time with the owners of All3, the Emirati-backed fund RedBird IMI, led by former CNN boss Jeff Zucker.

The UK broadcaster two years ago looked at buying All3, which is based in London and is the maker of hit series including Gogglebox, Call The Midwife and The Traitors, starring Claudia Winkleman. Those talks are understood to have progressed to a very detailed level.

McCall saw All3 as a good fit with her ITV Studios business, but was outbid by RedBird IMI, which tabled an offer of £1.15 billion.

If a deal goes through this time, the idea is to hive off ITV Studios, which produced hit real life drama Mr Bates Vs The Post Office.

The division would be merged with All3 to create a new company whose shares would be listed in the City.

The ITV broadcast and streaming business would retain its own separate share quote.

Listing the new creative company on the stock exchange in London would be a huge fillip for the Square Mile, which in recent years has seen a number of companies defect to the US and elsewhere.

McCall is passionate about the need for vibrant UK capital markets. It is understood she views a London listing as a top priority in any deal.

ITV Studios produces hit shows such as Love Island and The Voice.

Most of ITV’s revenues now come from ITV Studios and from streaming. ITV Studios’ profit rose 5 per cent to a record £299 million last year. But fans of McCall believe her successful pivot of the business is not reflected in its share price, which has been hit by a slowdown in linear advertising and weak confidence in the UK economy (see chart above).

She has been under pressure for some time to unlock value by hiving off ITV Studios.

If a deal does happen, it would create one of the largest production operations in Europe.

All3 revenues were £995 million in 2023, on which it made a £107 million profit. RedBird Capital Partners, the private equity outfit that runs RedBird IMI, is best known in this country for its failed attempt to take over the Telegraph newspaper group.

All3Media was set up in 2003 and was taken over by private equity group Permira in 2006. Eight years later, it was sold to Warner Bros Discovery and Liberty Global, the biggest shareholder in ITV, before being sold again to RedBird IMI.