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Granada has spent $90 million on a 9% stake in Australia’s second-largest commercial TV network, Seven Network.

The two companies are to set up an independent production house in March to produce programmes for the Australian market. Artist Services Group, Granada’s existing Australian production venture, will be merged into the new company.

“This is a major strategic move for our international media business,” said Charles Allen, Granada’s chief executive, of the stake.

Granada will seek a seat on Seven’s board. Foreign companies are limited to a maximum 15% stake in Australian broadcasters.

Seven said Granada’s investment would help it expand into international markets and new media.