Sky to acquire ITV broadcast arm for £1.6 billion
Sky has agreed to acquire ITV’s Media & Entertainment division for £1.6 billion, combining the broadcaster's pay-TV and broadband assets with ITV’s free-to-air channels and ITVX streaming platform. The acquisition aims to achieve £200 million in annual cost savings across technology and operations, though ITV Studios will remain an independent production entity.
Key Takeaways
- Sky will pay £1.2 billion in cash up front, with an additional £200 million performance-related earn-out based on 2027 advertising revenue.
- The combined entity will control approximately 20% of all UK in-home television viewing, positioning it second only to the BBC and ahead of YouTube.
- ITV Studios remains a standalone company and will acquire Love Productions from Sky as part of the transaction structure.
- The companies project £200 million in annual cost savings within three years by consolidating technology, marketing, and content operations.
- Sky inherits ITV’s public service broadcasting licenses and associated commitments through 2034, including regional news and free-to-air sports requirements.
Why It Matters
The merger creates a domestic commercial champion with the scale to counter global platforms like Netflix and Disney+ in the UK market. By combining subscription and ad-supported models, Sky and ITV aim to dominate local reach, though a projected 70% share of the TV advertising market will trigger intense regulatory scrutiny from the CMA. For the broader ecosystem, it signals a shift toward horizontal consolidation as local broadcasters seek a sustainable footprint against Big Tech. Watch for the CMA’s Phase 1 decision, specifically regarding remedial requirements for Sky’s existing third-party ad sales contracts with rivals like Channel 5.
Additional Context
The acquisition arrives as the global media sector undergoes aggressive restructuring. Only one week prior, in June 2026, Comcast announced plans to spin off NBCUniversal and Sky into a standalone media company, effectively separating its high-growth connectivity segments from its television assets. This spin-off, expected to complete by mid-2027, would place the newly combined Sky-ITV entity under the leadership of Mike Cavanagh, who per Broadband TV News (June 2026) is set to become CEO of the independent NBCUniversal group.
Simultaneously, the UK regulatory environment is navigating multiple mega-mergers. Per The Guardian (July 2026), Paramount is currently navigating a $110 billion pursuit of Warner Bros. Discovery. This deal has faced delays in the UK, where Culture Secretary Lisa Nandy signaled a potential public-interest intervention in July 2026 due to concerns over media plurality. The Sky-ITV transaction faces a similar hurdle with ITN, the news provider for ITV, Channel 4, and Channel 5. Under the agreed terms, Sky would inherit a 20% indirect stake in ITN, which produces three out of the four main national commercial news bulletins.
Strategically, the deal secures the future of ITVX, which reported 16.5 million monthly active users in 2025 according to analyst data cited by The Guardian (June 2026). By integrating ITVX into Sky’s distribution ecosystem, the companies intend to build a "national streaming champion" that leverages ITV’s massive reach—which the Financial Times (July 2026) estimates at 21 million households—alongside Sky’s advanced advertising technology stack. This move follows internal industry pressure as ITV’s share price has struggled with a soft linear advertising market, losing significant value over the preceding five years.
Read full article at broadbandtvnews.com
Enjoy our coverage?
Add StreamingMeme as a preferred source on Google to see more of our streaming news at the top of your Search results.
Add as preferred source