According to a report in the Sunday Express, Ulster TV is partnering with venture capital group 3i and Scottish Radio Holdings to bid for SMG, which owns the Scottish Television and Grampian ITV franchises as well as a 25% stake in GMTV.
The paper says the £400m bid follows an earlier offer before Christmas, which was rejected by SMG's board. This morning SMG's shares were ahead 1.7% to 120p in early trading.
A merger would create a regional ITV force combining three franchises and offering a better negotiating position alongside ITV PLC, created earlier this year out of the £5.8bn merger of Carlton and Granada. It would leave only one independent franchise remaining: Channel TV, which serves the Guernsey and Jersey Channel Islands.
There has been speculation that ITV PLC might bid for SMG. ITV chief executive Charles Allen has previously said that he would be interested in snapping up the Scottish franchises.
There have long been rumours that SMG, which also owns cinema ad firm Pearl & Dean, is to be broken up. Two years ago SMG was said to be preparing to sell its ITV interests for up to £480m in an attempt to wipe out its £380m debt and boost its balance sheet.
In the end it sold off its publishing division, which includes the Glasgow Herald newspaper, to US newspaper giant Gannett for £126m in a deal that won approval a year ago.
More recently it sold off its 29% stake in Scottish Radio Holdings in another effort to cut debt. Last week it reported pre-tax profit down 25% to £17.5m. The group blamed the fall on a slump in advertising and the effects of a restructure.
News of the Ulster bid comes despite Andrew Flanagan, SMG's chief executive, last week rejecting the idea of a break-up.
"The break-up story is put about by those who would love to see it happen -- because they would love to get their hands on those assets," he said.
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .
.jpg)
.jpg)