The mooted merger between Carlton Communications and Granada Media’s digital TV joint venture, ONdigital, with Britain's main ITV commercial network [WAMN: 23-Apr-01], yesterday ran into strong opposition yesterday from key ITV shareholders.

Carlton/Granada, dominant shareholders in ITV and 50/50 owners of ONdigital, announced Monday their intention to rebrand the cash-haemorrhaging pay-TV service as ITV Digital.

Scottish Media Group, holder of the Central and North ITV franchises in Scotland, denied that the merger had its support and slammed the duo's offer of compensation: “We have not yet agreed in principle to the proposals and the terms offered to us by Granada and Carlton are not acceptable,” said an SMG spoke.

SMG, the largest of the minority shareholders in ITV, almost certainly reflects the views of the other small franchisees, among them Ulster Television and Border. Having no financial interest in the digital platform, all are entitled to compensation for its use of the ITV brand.

Granada and Carlton declined to respond to SMG’s criticism but industry analysts saw the attack as a ploy by the canny Caledonians to bolster SMG’s negotiating position. They dismissed it as unlikely to torpedo the deal.

News source: The Times (London)