RTL, the owner of five, is understood to be readying a bid for rival broadcaster Channel 4. According to reports, the German-owned media conglomerate has asked investment bank JP Morgan to investigate a possible takeover of Channel 4.
The bid comes after warning that state-owned Channel 4 will run out of money 2012 if a funding solution cannot be found. The broadcaster estimates that the channel will need extra funding of up to £100m by 2012 if it is to deliver its public service remit.
It is currently funded by advertising, which has been hit by the economic downturn, and the fragmentation of audiences following the rise of digital channels and online.
Ofcom, the media regulator, has mooted options including redistributing some of the BBC’s annual licence fee to Channel 4, or giving the channel control of all or part of BBC Worldwide, the corporation’s commercial arm.
A potential acquisition of C4 by RTL could cost as much as £500m and come four years after previous merger talks between C4 and Five collapsed.
It has previously been suggested that RTL is interested in ITV, the UK’s largest commercial broadcaster. The reports followed the Competition Commission ruling that BSkyB must sell a majority its 17.9% shareholding in ITV.
Five chief executive and chairman, Dawn Airey, joined the broadcaster earlier this year from ITV, where she was managing director of global content.
RTL owns more than 40 TV channels in 10 countries and has ambitions to expand further in the UK.