ITV has sold its holding in BritBox International in order to concentrate on expanding its streaming service and global studios operations.
The broadcasting giant has offloaded its 50 per cent stake in the digital subscription platform, which has around 3.75 million subscribers, to its joint venture partner BBC Studios for £255million.
It intends to use the estimated £235million in net proceeds from the transaction to finance a share buyback, which it plans to begin after publishing its annual results on 7 March.
Sale: ITV has offloaded its 50% stake in BritBox International, which has around 3.75 million subscribers, to its joint venture partner BBC Studios for £255million
ITV said the deal reflected the strategy to focus on ‘supercharging’ video-on-demand service ITVX and growing its television production arm ITV Studios.
The London-listed group will still receive a revenue stream ‘similar to current levels’ from BritBox for the use of its programmes as part of new licensing arrangements.
Tom Fussell, chief executive of BBC Studios, said the ‘important acquisition…fits with our stated ambition to double the size of our business.
‘BritBox International has British content at its heart, and it generates and satisfies demand for British shows outside the UK. We will continue to make significant investments in the future to deliver long-term value to the BBC.’
BritBox was first launched seven years ago in the United States amid the surging popularity of streaming services, including Netflix and Amazon Prime.
Later on, the platform was broadened to Canada, Australia, South Africa, and multiple Nordic countries, while a separately managed UK streaming service came online in November 2019.
Subscribers get access to old British films and television series, as well as original content, such as espionage drama A Spy Among Friends, Irvine Welsh’s Crime and the revival of satirical puppet show Spitting Image.
Subscriber numbers swelled during 2020 and 2021 as Covid-related curbs on socialising led to people spending more time at home.
But BritBox faced massive competition to attract viewers in a streaming market saturated with bigger-budget rivals like Hulu, Disney+ and Peacock.
Last month, ITV confirmed it would close BritBox UK’s standalone service at the end of April, with all content and customers transferring to ITVX.
‘BritBox International was always the runt of the litter when it came to streaming services, with a primary focus on classic British TV productions,’ said Russ Mould, investment director at AJ Bell.
He added: ‘While there is an audience for this type of content, it’s much smaller compared to the mainstream platforms.’
ITV shares skyrocketed 15 per cent to 63.5p on Friday morning following the sale’s announcement, making them the FTSE 250 Index’s biggest riser.
