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Britain OKs media mergers
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July 14, 2000: 10:16 a.m. ET
Government approves TV deals; shakeout for control to follow
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LONDON (CNNfn) - Britain cleared the way for two potential media mergers Friday, throwing open the battle for control of the nation's Independent Television network (ITV), its most popular commercial station.
Minister Ian Byers, head of the Department for Trade & Industry, said he would allow Carlton Communications PLC and United News & Media PLC to merge, although he also cleared Granada Group PLC to bid for either company.
The three companies are the main operators of ITV, and control 10 of the commercial network's 15 regional franchises.
Carlton and United must agree to divest Meridian, one of United's regional franchises, before they can proceed with their merger. Meridian broadcasts to Britain's south coast.
Granada is also free to continue its pursuit of either competitor. A source close to the company told CNNfn.com that Granada's senior managers were meeting immediately with financial advisers to discuss the firm's next move.
Carlton and United announced plans to merge last year. A month later Granada said it would consider making an offer for either one of them. The broadcasters are facing increased competition from cable and satellite TV companies.
The government also waived a restriction on advertising share that had for years limited commercial television operators' scope for acquiring one another. Television companies had been forced to limit their share of overall TV advertising revenue to 25 percent or less.
Granada Group, which has substantial lodging and catering activities, earlier this week listed shares in its media unit Granada Media PLC. Granada Media is currently valued at £7.5 billion ($11.25 billion), while Carlton (CCM) is valued at £5.4 billion, and United (UNWS) is worth £4.8 billion.
Carlton shares slipped almost 2 percent to 811 pence after the news, while United stock rose a similar amount to 937 pence. Granada Media (GME) jumped more than 3 percent to 590 pence. 
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