The merger of a free-to-air commercial broadcaster like ITV and the pay-TV Sky was unthinkable only a few years ago. However, the popularity of YouTube and other streaming services has left traditional TV companies in a vulnerable position.
Comstat’s Sky to buy Britain’s ITV in a $2.13 billion deal to create a British streaming service capable of competing with global giants like Disney, Amazon and Netflix. Dana Strong, CEO of Sky, announced the deal and described it as a defining moment in British television history. It will now be reviewed by regulators and lawmakers.
The merger of a free-to-air commercial broadcaster like ITV and the pay-TV Sky was unthinkable only a few years ago. However, the popularity of YouTube and other streaming services has left traditional TV companies in a vulnerable position.
Analysts are estimating that this merger would account for over 70% of the UK’s television advertising market. The entire transaction amount, which includes ITV Studios purchasing Sky’s Love Productions, may be between £80 million and £120 million based on comparable agreements and an earn-out.
ITV shares jumped 2.9% after news organisations reported on the merger last week. As a result, the group, which is made up of its broadcast and streaming division and ITV Studios production company, had a total market worth of £3.1 billion. ITV has been in talks with Sky since November 2025 to sell its Media & Entertainment units. Therefore, ITV’s channels and streaming platform ITVX from ITV Studios have been separated.
Following the announcement of the merger plans between the two companies, ITV shares increased 1% to 83 pence in early trading on Monday. ITV will continue to exist as a stand-alone production firm following the merger, making shows for the combined ITV-Sky, such as Love Island and Coronation Street, as well as for other worldwide broadcasters and streaming services, such as the highly popular Rivals it develops for Disney.
ITV will get £1.2 billion in cash from the Great British Bake Off producer Love Productions, with an earn-out of up to £200 million contingent on its advertising success in the 2027 fiscal year. Strong assured that the collaboration would deliver some ‘outstanding British programming’ in a rapidly changing world, and that ITV will remain a public service broadcaster.
The newly merged entity is hoped to compete as one of the UK’s top three streamers against global giants Netflix, YouTube, Amazon Prime Video and Disney+. ITV was originally a group of regional franchises more than 70 years ago and has been associated with generations of lawmakers. Just last week, the UK’s Culture Minister Lisa Nandy announced that she could intervene in the US-Paramount deal to check antitrust violations, demonstrating how media deals are shaped.
The UK’s threat to intervene in the $110 billion Paramount-Warner Bros deal has little to do with blocking the transaction and more about the impact such a deal could have on the country’s news, children’s TV and investment. Nandy reaffirmed that the government’s inclination to intervene in this deal is purely in the public interest and to avoid compromising media plurality.
While the Minister seems keen to intervene, lawyers and media advisers believe that the case for public interest intervention is insufficient. However, Paramount could volunteer certain remedies rather than risk a governmental review which will only delay the deal and increase costs. These remedies could include a commitment to preserving independent news provision and UK children’s programming. It could also promise to maintain or expand Warner Bros’ British production endeavours like the Leavesden studios.
While countries like Kuwait, Saudi Arabia and Australia have already greenlit this deal, like the UK, some US states like California and New York are preparing a lawsuit to block it despite the US Department of Justice’s clearance.
