Two of the UK’s best-known private equity firms are potential partners for the
As unions go, the potential marriage of the BBC’s commercial arm and private equity is slightly less unexpected than that of Nicolas Sarkozy and French-Italian supermodel Carla Bruni, but slightly more likely to succeed than not-so-super model Heather Mills and Paul McCartney.
Reports of BBC Worldwide holding discussions with unnamed private equity groups both to source and co-fund acquisitions in media production, publishing and intellectual property (IP) are believed to be in response to a lower than expected licence fee settlement, agreed last year, which required greater financial returns while also putting constraints on BBC Worldwide extending its borrowing limit above £350m.
BBC Worldwide’s last major acquisition was a 75% stake in travel guidebook publisher
The tie-up would also make sense for private equity, which currently has its own market-induced constraints on borrowing. A similar deal occurred late last year when Apax Partners acquired Emap alongside Guardian Media Group. A focus on intellectual property brands also puts
Apax bought
In 2006, HIT made a £144m approach for
Since then, 3i has backed Chorion’s purchase of
There are bound to be critics of such a union, with concern that the state broadcaster is moving further away from its public remit, but there is also the possibility that the two could learn from one another: the unwieldy BBC could do with private equity’s discipline, while the latter could profit from the generally positive public image of the BBC – outside the UK at least. A corporate Catherine Zeta-Zones and Michael Douglas, if you will, for those who like happy endings.