ITV Shares Rise After £1.6bn Sale of Media & Entertainment Arm to Sky

Shares in ITV plc (LON: ITV) climbed on Monday after the broadcaster announced the sale of its Media and Entertainment (M&E) business to Sky for total consideration of up to £1.6 billion, in a deal that will reshape the company into a pure-play global content producer.

ITV stock was trading at 82.7p in early dealing, up 1.16% from Friday’s close of 81.75p, as investors welcomed the transaction and the prospect of a substantial cash return to shareholders.

Under the terms of the deal, Sky — a subsidiary of Comcast that is expected to join NBCUniversal following Comcast’s planned separation — will pay ITV £1.2 billion in cash upfront, alongside the contribution of its Love Productions business, valued at £200 million. A further £200 million of contingent consideration could follow in 2028, tied to ITV’s advertising revenue performance in 2027.

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ITV said net proceeds of roughly £1.05 billion, after transaction and separation costs of around £185 million, will first be used to reduce debt at the remaining ITV Studios business to about 1.5x net debt to EBITDA. The board then intends to return approximately £950 million to shareholders — equivalent to 25p per share — once the deal completes, expected in the second half of 2027.

Chairman Andrew Cosslett said the transaction “secures ITV’s crucial role as a Public Service Broadcaster” while unlocking value in ITV Studios, which will become a standalone, London-listed global content business. Chief Executive Carolyn McCall added that the deal delivers “clear, tangible value for shareholders” while safeguarding public service commitments, including regional and national news, under Channel 3 licences that run until 2034.

Sky’s Group CEO Dana Strong called the tie-up “a defining moment for British media,” combining free-to-air, pay-TV and streaming to better compete with global platforms.

As part of the arrangement, ITV Studios will sign a long-term content supply agreement with Sky and ITV M&E, including a minimum spend commitment of £2.1 billion between 2028 and 2032, covering shows such as Coronation Street, Emmerdale and Love Island.

ITV also reaffirmed current-year guidance, noting total advertising revenue is tracking up around 8% in the second quarter, with a “strong July ahead.” The transaction remains subject to regulatory approval, with a Capital Markets Day for ITV Studios planned ahead of completion.