Sky has announced a £1.6bn deal to acquire ITV's media and entertainment (M&E) business, the company confirmed on 6 July 2026, ending months of negotiations that began in earnest when ITV disclosed preliminary talks in November 2025. ITV's share price surged on that November disclosure; the formal announcement arrived via a regulatory filing classified under 'Disposals' at 07:00 BST on July 6.

The structure of the transaction carries some nuance. Sky, owned by US telecoms group Comcast, will pay £1.2bn in cash upfront for ITV's M&E business — the assets that encompass its free-to-air UK channels and the ITVX streaming platform. A further payment of up to £200m is contingent on 2027 advertising revenues, to be settled in the second half of 2028. That deferred tranche effectively makes the buy-side's total exposure dependent on how linear and digital ad markets perform over the next 18 months — a meaningful hedge, given the structural uncertainty still hanging over broadcast advertising. The deal was reported as equivalent to approximately $2.1bn at the exchange rate when terms were agreed in late June 2026.

One element travels in the opposite direction. As part of the overall arrangement, Comcast will sell its Love Productions business — the indie behind The Great British Bake Off — back to ITV for £200m. The reciprocal transfer tidies up a long-standing anomaly: Comcast had held Love Productions through a prior acquisition, and Bake Off always sat more naturally alongside ITV's content estate than inside a US telco's asset ledger.

Critically, ITV Studios is not part of the sale. The production arm — one of the world's largest independent producers, with titles including Love Island, I'm a Celebrity and Mr Bates vs the Post Office — remains with ITV plc. That carve-out matters for how you read ITV's post-transaction shape. The company exits this deal as a pure-play global producer, stripped of the distribution infrastructure that historically anchored its UK business but also weighed on its valuation relative to unencumbered studio peers.

Sky, for its part, has committed to spending at least £2.1bn on the acquired M&E business between 2028 and 2032 under a long-term strategic partnership framework. That figure signals the acquirer's intent to invest in the asset rather than harvest it — though commitments of this type in media M&A are notoriously elastic when market conditions shift. ITV chair Andrew Cosslett issued a statement in connection with the deal; the company also published a concurrent regulatory announcement regarding a substitution of rating agency on its 2026 and 2032 notes, suggesting the capital structure work running alongside this transaction is already in motion.

The trajectory from announcement to signing took roughly eight months. ITV's Q1 2026 trading update — covering the three months to 31 March — still described the company as being "in active discussions with Sky regarding a possible sale of the M&E business," indicating that the final terms took the full first half of 2026 to lock down. The deal's advertising-revenue earnout is a direct product of that period: both sides clearly found linear ad market uncertainty too difficult to price cleanly at signing, so they split the difference across a contingent mechanism.

The broader competitive logic is straightforward enough to state, if harder to execute. Comcast acquires a substantial free-to-air audience footprint and a streaming platform in ITVX — complementing Sky's existing pay-TV and NOW subscriber base — without paying for the production capacity it doesn't need. ITV plc sheds the increasingly capital-intensive broadcast and platform infrastructure and concentrates on Studios, where IP ownership and international licensing generate the margins that traditional UK broadcasting no longer reliably does. Whether ITVX, folded into the Sky ecosystem, can compete meaningfully with Netflix and Disney+ is a separate question — and not one this transaction alone can answer. What the deal does accomplish is consolidating the two largest legacy players in UK commercial television under a single corporate roof, leaving the BBC as the sole major broadcaster outside any Comcast orbit.

Regulatory clearance will be the next material milestone. A transaction of this size and strategic consequence, combining two of the UK's most prominent broadcasters, will draw scrutiny from Ofcom and the Competition and Markets Authority. Neither body has yet commented publicly. The timeline to completion — and the conditions that may attach to it — remain open.