ITV sells media and entertainment arm to Sky for £1.6bn to create UK streaming champion

The deal

ITV has agreed to sell its media and entertainment division to Comcast-owned Sky in a transaction valued at up to £1.6 billion. The sale includes ITV's free-to-air channels and its streaming platform ITVX, but excludes ITV Studios, the production arm behind shows like Love Island and Coronation Street. Sky will pay £1.2 billion in cash, transfer its Love Productions unit (valued at £200 million) to ITV Studios, and may pay an additional £200 million earn-out tied to advertising performance in 2027.

Bringing Sky and ITV Media & Entertainment together combines the very best of free-to-air television, pay TV and streaming, ensuring viewers across the UK continue to enjoy outstanding British programming in a rapidly changing world.

What changes for viewers

The combined entity will become the UK's largest commercial broadcaster, accounting for about 20% of all in-home television viewing, second only to the BBC and ahead of YouTube. Sky said the new business will deliver more sport on free-to-air channels, while ITV News and Sky News will remain distinct editorial voices. ITV chief executive Carolyn McCall expressed confidence in the transition.

I feel confident that Sky will be a strong and responsible custodian of ITV M&E, building on its heritage while investing in its future.

ITV Studios goes solo

After the sale, ITV Studios will operate as a standalone, publicly listed content business on the London Stock Exchange. It will retain ownership of hit formats and enter a long-term supply agreement with the new Sky-ITV combination. Sky has committed to spending at least £2.1 billion on content from ITV Studios over the period 2028 to 2032. ITV chairman Andrew Cosslett framed the deal as a necessary step to preserve the broadcaster's public service role.

For over seventy years, ITV has played an important and valuable role in the country's public life. At a time of rapid change in the industry, it is right that we now preserve ITV's crucial role as a public service broadcaster and this operation achieves that goal, with ITV's Media and Entertainment division joining Sky to create a UK champion with the size and resources needed to best compete with global streaming platforms.

Competitive pressure

The transaction is a direct response to the growing dominance of global streaming platforms such as Netflix, Disney+, Amazon Prime Video, and YouTube. Sky said scale is essential to compete, and the merged business will have a larger content budget and better technology. The companies expect to achieve annual cost savings of around £200 million within three years. The deal also comes as Comcast prepares to spin off its Sky and NBCUniversal divisions into a separate publicly traded company, a move announced on 29 June.

Financial terms and timeline

ITV expects net proceeds of approximately £1.05 billion after transaction and separation costs estimated at £185 million. Part of the proceeds will be used to reduce debt, with around £950 million (equivalent to 25 pence per share) returned to shareholders. The transaction is subject to regulatory review, with antitrust scrutiny expected given that it combines the UK's two largest commercial broadcasters, reaching 21 million households. Closing is anticipated in the second half of 2027.