Ministers have taken another step forward in plans to explore a potential sale of Channel 4 as the growing popularity of streaming sparks a frenzy of major media dealmaking.
The state-owned broadcaster has reportedly been added to a list of assets that could be sold as the Treasury looks to shore up the country’s finances after the pandemic.
The government has begun talks with investment banks about advising on a potential deal, which could include a trade sale or stock market listing, the Times reported.
It comes weeks after culture secretary Oliver Dowden said a move to privatise Channel 4 was “on the table” as part of a wider review into the UK’s public service broadcasters.
He added that the government had “not ruled out” selling the company by 2024, when its current licence will need to be renewed.
Youth-oriented Channel 4, which was launched in 1982, is publicly owned but commercially funded.
Alongside other traditional broadcasters it is facing tough competition from new streaming rivals such as Netflix, Amazon Prime and Youtube, which are increasingly attracting younger audiences.
The Great British Bake Off broadcaster has also suffered from a pandemic-induced hit to advertising revenue, which collapsed by as much as 50 per cent at the height of the crisis last year.
But a deal to privatise the channel would come at a buoyant time for the media market, as the race to snap up film and TV assets has sparked a frenzy of major deals.
In recent weeks AT&T agreed a $43bn deal to merge Warner Media with Discovery, creating a major new streaming platform. This was followed last year by Amazon’s $8.45bn takeover of MGM, the film studios behind the James Bond franchise.
Channel 4 was reportedly valued at around £1bn when a sale was previously considered by the government in 2016. However, it is not clear how much the channel would fetch if it was put up for auction today.
The valuation would likely also depend on whether a privatised Channel 4 was still bound by public service broadcasting obligations and retained its ban on owning its own programmes.
Channel 4 has refused to comment on the potential sale, but has emphasised on its impact on the wider UK broadcasting landscape through its commissioning of independent producers.
In October chief executive Alex Mahon said advertising had bounced back strongly after an initial slump at the start of the pandemic, adding that the company would end the year with a “significant financial surplus”.