TV bosses: market shows no sign of slowing
The market to invest in UK indies has become “ferociously competitive” and shows no sign of slowing, according to leading TV bosses including BBC Worldwide chief executive Tim Davie and former Shine Group chief executive Alex Mahon.
Last week, ITV revealed that it was still chasing a “healthy pipeline of M&A opportunities”, while Channel 4 invested in David Wise’s VR-focused indie, the 13th deal for its Growth Fund.
Other deals struck this year include BBC Worldwide taking a stake in Tim Hincks and Peter Fincham’s indie Expectation, Sky’s acquisition of True North and All3Media’s investment in scripted producers Two Brothers Pictures and Two Halves Pictures.
Speaking at the Deloitte Enders Media & Telecoms 2017 conference, Davie said: “It is ferociously competitive in this space. If you’ve got three or four drama commissions, it’s a good time to be out there. Securing those creators is the engine room of our business.
“You won’t see too many CEOs that won’t give you roughly the same strategy – killer IP and strong brands. I want to spend capital primarily on [UKbased] content creators,” he added.
Mahon, who previously led the Broadchurch and MasterChef production group and is now chief executive of VFX firm The Foundry, said there is no “ceiling” for these deals.
The production sector has very low barriers to entry, she claimed, with a “few hundred companies” refreshing the creative community over the past 18 months.
“We have a massive gap in the middle of the market; there’s lots of companies that are sub-£10m and a few that are sub-£1bn,” she said.
She added that one reason the market remains buoyant is the addictive nature of investment. “Having done those sorts of deals, when you do one big consolidation deal, you are inextricably drawn to the next,” she said.
Mahon also highlighted superindies and broadcasters’ strategy of buying firms to address falling production margins. “If you take ITV’s results… they have a £1.4bn production division and they’ve been buying companies like it’s going out of fashion. [But overall] ITV was only up 4% year on year,” she said.
Peter Salmon, who joined Endemol Shine Group as chief creative officer last year after six months in charge of BBC Studios, said super-indies are better positioned than in-house units to lure producers. “Our ability to offer talent the right-shaped home in terms of support is particularly attractive,” he said.
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