ITV has agreed to sell its media and entertainment arm to Sky for up to £1.6 billion, a deal that hands over its terrestrial TV channels and the ITVX streaming service. The agreement, confirmed after months of talks, does not include ITV Studios, the production business behind I’m A Celebrity and Mr Bates Vs The Post Office.

The logic is scale. Combining ITV’s channels with Sky creates a broadcaster with enough weight to compete against the global streaming platforms that have been pulling away viewers and advertising money for years.

How the £1.6bn Breaks Down

ITV receives £1.2 billion in cash up front. Sky also hands over Love Productions, its production company valued at £200 million. A further payment of up to £200 million arrives in the second half of 2028, tied to how advertising performs in 2027.

That last piece matters. If the ad market stays soft, ITV never sees the full £1.6 billion. The structure shares the risk between buyer and seller.

What Happens to ITV Studios

ITV Studios stays behind as a standalone production company with a global customer base. The two companies will also sign a long-term content supply agreement, with Sky committing to spend at least £2.1 billion on ITV Studios programming between 2028 and 2032.

For ITV, the sale is a bet that its production arm is worth more on its own than tied to a declining broadcast business. The Studios operation keeps making shows. Sky keeps buying them.

A Long Road to Completion

The deal is not expected to complete until the second half of 2027. Regulators will examine what the combination means for British television, where Sky and ITV have been the two largest commercial players for decades.

Until then, ITV keeps running its channels and ITVX as normal. Viewers will notice nothing for at least a year.

Completion is expected in the second half of 2027, with the final £200 million payment resting on how 2027 advertising performs.