ITV considers Scottish Media Group takeover

ITV is rumoured to be considering a bid for Glasgow-based broadcasting and media company Scottish Media Group (SMG), which owns Virgin Radio and STV, the Scottish regional ITV licence, among other things.

Although ITV has declined to comment on the speculation, it is believed the group’s acting chief executive John Cresswell is interested in SMGs television franchises more than anything else but would prefer any deal be for the entire group rather than individual departments. SMG — which has already had a troubled year — came out earlier this month and said that its full-year profits for 2006 would be behind expectations, a statement which plummeted shares to a 15-year low.

SMGs chief executive, Andrew Flanagan, left the group earlier this year after coming under pressure from shareholders after the business’ ongoing poor share performance. The potential interest of ITV — which sold out of TV3 earlier this year — isn’t the first time SMG has been the focus of a possible takeover in recent months. Just last month, Ulster Television (UTV) ended negotiations with the Scottish group after previously having made two unsuccessful merger bids. Its first offer would have seen SMGs shareholders receive a 50% interest in the merged entity with the upgraded offer putting a 52% share on their table. However, both advances from the Belfast-based broadcaster were turned down.

SMG hasn’t commented on the links with ITV. Its latest statement concentrates on the sale of its cinema advertising subsidiary, Pearl & Dean; which has apparently attracted interest from a number of potential buyers.