ITV has agreed to acquire a controlling stake in Gurney Productions, an independent producer of US cable television networks.
The UK TV network is purchasing a 61.5% stake in Gurney Productions for $40m, with a put and call option to buy the remaining 38.5% interest in the company. The put and call could be made from three years after the initial deal.
ITV said the acquisition marked a significant step forward in building a strong global business. Gurney Productions is a high margin business with the company's EBITA for 2012 forecast at $10m.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The company's portfolio includes the highly successful cable show Duck Dynasty, a reality series about the family that runs the duck call fabrication business.
Adam Crozier, Chief Executive of ITV plc, said: "Growing ITVStudios is a key part of our strategy to rebalance the group. Our studios business is already showing strong organic growth and the acquisition of Gurney is an important step forward as we continue to expand our international production capability.
"We see the US as a key creative market and having a sizeable presence there is central to the expansion of our global content business. ITV Studios America has been growing revenues at around 20% for the last two years under the leadership of Paul Buccieri. Gurney is a great company with terrific programme brands, which will add scale to our already successful US business.
"Over the last seven years the team at Gurney has built a strong and growing pipeline of high end factual entertainment and reality programmes and I'm absolutely delighted to welcome Scott and Deirdre to the ITV fold where we believe the business can continue to develop and thrive."
Gurney Productions was founded in 2005 by Scott and Deirdre Gurney. It has become a leading independent producer of large scale returning series for US cable networks.
RD
