Government weighs up plans to float Channel 4 on the stock market
Culture secretary Nadine Dorries is considering plans to list Channel 4 on the stock market as an alternative to selling it to a rival broadcaster.
Officials in the Department for Digital, Culture, Media & Sport (DCMS) are working with JP Morgan on plans to float the TV network in London, after Dorries set out plans to privatise the broadcaster last week.
An IPO would be used as an alternative means of privatising Channel 4, if the government fails to find an eligible bidder, according to the Sunday Times.
The government hopes to reap more than £1bn through the sale of the public-service broadcaster. Potential bidders include ITV, Sky and Channel 5 owner Paramount.
However, bankers fear a sell off may only solicit bids of up to £500m, meaning the government may instead opt to list the channel on the stock exchange.
The plans come after Dorries argued that privatizing the Great British Bake-Off broadcaster would help it compete against “streaming giants” such as Netflix and Amazon.
Critics of the government argue the privatisation plans are politically motivated, due to the view that the state-owned broadcaster is left-wing and critical of the Tory government.
The float would come as the biggest listing of a public entity since shares in Royal Mail were floated on the London Stock Exchange in 2013. Shares in Royal Mail are currently down 27.7 per cent since its 2013 IPO.
The plans come after Channel 4 warned the government a sell-off could result in a £3bn hit to the UK economy and put independent out of business.
Channel 4 is currently publicly owned but funded entirely through advertising. It current remit means it does not produce its own shows but instead commissions independent production houses for content.
Critics of the government’s plans have raised concerns that a privatised Channel 4 may take fewer risks in commissioning more experimental films and TV shows.