ITV 'looking to offload SDN'

Speculation over possible disposals at ITV continued amid reports the broadcaster may be looking to offload Freeview channel operator SDN.

The business, which rents capacity to channels including Five and QVC, is seen as one of ITV's best non-core assets with a value in the region of 200 million.

ITV was recently linked to the sale of networking site Friends Reunited, which it bought for 175 million in 2005 but may now be worth as little as 50 million.

Executive chairman Michael Grade is under pressure to dispose of assets as the economic downturn takes its toll on advertising revenues.

As well as disposals, the Mail on Sunday said ITV may ask shareholders for 300 million in a rights issue. Details of Mr Grade's strategy will emerge on March 4 when the company announces results for 2008.

ITV staff are braced for a new round of job losses, while the company's ringfenced programme budget is likely to be trimmed by 5%.

The broadcaster is reportedly facing a 20% drop in advertising revenues for the first three months of this year, with March down by as much as 30%.

No decision has been taken on whether ITV will sell SDN, which former chief executive Charles Allen bought for 134 million in 2005. He said the business provided ITV with the capacity to launch more digital channels.

SDN holds a licence from Ofcom to broadcast channels on Multiplex A, one of the six multiplexes on the digital terrestrial platform that is principally used by Freeview. Multiplex A broadcasts over 20 channels and existing customers include Five, Disney, Turner, EMAP and Teletext.