The publisher has closed the deal with owner RTL and its parent company Bertelsmann with immediate effect.
Gerhard Zeiler, chief executive officer of RTL Group, says: “With a significant recovery of the UK TV advertising market and Five performing well in the first half of 2010, we saw a window of opportunity to realise a transaction based on a fair evaluation of Five.
“The disposal is in line with RTL Group’s strategy of being number one or two in each of our markets. I would like to thank the whole team at Five and CEO & Chair Dawn Airey for their passion and professionalism, especially in the difficult past 20 months which saw a comprehensive restructuring of the company.”
Desmond is chairman of the Northern & Shell Network, which owns the Daily & Sunday Express, Daily & Sunday Star, OK! magazine, New! and Star magazine. He also runs a number of pay TV channels including adult station Television X.
The deal could be the subject of a House of Commons culture committee inquiry, due to potential conflicts of interest. Desmond will be barred from promoting his titles on Five under EU cross-promotion rules
Speculation suggests that Desmond will look to revive cheaper entertainment shows and reality shows and to draw on the celebrities who have agreements with his publications. If a deal is cleared by regulators he will be able to promote the channel in his newspapers and magazines.
Five’s chief executive Dawn Airey is to retain her position.
Five has public service broadcast (PSB) obligations under its current terrestrial licence, which runs until 2014. It must screen a set amount of news and current affairs each year and Desmond has pledged to Ofcom that he will continue to meet those requirements.
In the recent Sunday Times Rich List, Desmond’s wealth was estimated at £950m, unchanged from last year.