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UK government could float Channel 4 on stock market if it fails to receive a credible bid

Some in the City fear rival broadcasters may only be willing to pay £500 million for Channel 4, leading the government to opt for an IPO

According to reports, the UK government could look to list Channel 4 on the London stock market should it fail to receive a credible bid for the broadcaster.

The Sunday Times reports officials in the Department for Digital, Culture, Media and Sport are working with US investment bank JP Morgan on the idea.

The government hopes to generate more than £1 billion through the sale of the public-service broadcaster.

However, it’s believed some in the City fear rival broadcasters may only be willing to pay £500 million for the broadcaster, leading the government to opt for an IPO.

If it was to be floated, Channel 4 would be the biggest listing of a public entity since shares in Royal Mail were floated on the London Stock Exchange in 2013.

Channel 4’s CEO Alex Mahon has laid out an alternative plan to privatisation, suggesting a joint venture funded by private money that would invest an extra £200 million into programming each year.

Writing in the same newspaper, Mahon said: “We celebrate our 40th anniversary in November and I am glad to say we are the perfect example of ‘life begins at 40’. Channel 4 is a thriving national asset with a business model that has never been in better health.

“Throughout our four decades, we have not taken a penny in support from the taxpayer and, in fact, analysts estimate that we have returned about £12 billion to UK GDP in that time. In the past two years, our revenues have reached record levels and, unlike other broadcasters, we have no debt — and we have £270 million in cash in the bank. Even more important, we are as creatively healthy as we have ever been, with our shows picking up no fewer than 44 BAFTA nominations last week,” she added.

“Put simply, Channel 4 is a beautifully-designed economic miracle. And therefore, you might wonder why another Conservative government would want to swap out public ownership for private shareholders.”