The production arm of Scottish media group STV is set to embark on an international push following its £24m acquisition of "Lego Masters" company Greenbird.
Chief executive Simon Pitts said STV Studios will pursue a strategy to generate maximum value from its shows outside the UK following the deal for Greenbird, which has a network of 15 independent production businesses throughout the UK. The deal will more than double the Scottish group's portfolio of creative production labels and will increase full-time staff numbers from 35 to 70.
“With this deal today we take an even bigger stride forward in terms of the scale of the business and in terms of the creative firepower that it has, and as an example of that we will go from STV Studios owning nine different creative production companies [labels], to owning 24 different businesses," Mr Pitts said.
"We will go from having 12 returning TV series on our books, and what I mean by that is a series that keeps coming back [year after year], to having nearly 40 returning TV series.”
READ MORE: Business Insight: Lego Masters join the fold at Glasgow's STV Studios
He added: “It is right on strategy because it accelerates our revenue and our profit away from traditional television and towards the growth areas of owning global content and owning more intellectual property."
Founded in 2012 by Jamie Munro and Stuart Mullin, Greenbird specialises in "unscripted" production - entertainment and factual shows, rather than drama. Some of the shows from its producers include: Lego Masters by Tuesday’s Child for Channel 4/FOX; The Hit List by Tuesday’s Child for BBC One; the BAFTA-winning Misadventures of Romesh Ranganathan by Rumpus Media for BBC Two; and Mortimer and Whitehouse: Gone Fishing by Owl Power for BBC Two.
STV will pay an initial cash consideration of £21.4m for Greenbird, which was initially backed by BBC Worldwide but became majority-owned by Israeli media firm Keshet in 2018.
A further £2.6m in deferred considerations will be payable in the next two years, including approximately £1.6m for the founders subject to earn-outs and hitting certain profit targets. Mr Munro and Mr Mullin will also join the board of STV Studios in the roles of chief commercial officer and finance & integration director.
“This is an exciting new chapter in Greenbird’s history," the founders said in a joint statement, adding: “We’re delighted to be working with Simon [Pitts] and David [Mortimer] at STV. We look forward to a future together helping a wider network of creatives realise their ambitions.”
Mr Pitts said STV Studios is now within "striking distance" of becoming the UK's biggest regional producer, with expanded bases in Glasgow and London plus additional offices in Cardiff, Belfast, Brighton and Manchester.
Now with annual revenues of at least £70m, the Scottish group's enlarged production business will leapfrog Cardiff's Bad Wolf to become the second-biggest independent production outfit outside London and the south-east of England. Including minority shareholdings, STV Studios will is close to reaching par with Hollyoaks producer Lime Pictures of Liverpool, which has an annual turnover of approximately £110m.
READ MORE: Scottish broadcaster STV feels pressure from advertising slowdown
"If you look at all of our revenues across the unconsolidated minority companies we've invested in, we'd be north of £100m in 2023, so we now think we are within striking distance of becoming the number one nations and regions producer," Mr Pitts said.
He said the rational for this deal on the financial side was also "very compelling" with earnings enhancement from day one and an immediate boost to profit margins. In addition, the transaction has been funded from within the group's existing resources.
The studio division generated revenues of £24m in 2022 and made a profit of £1.3m. It was previously expected to more than double that in 2023 to £50m and £3m respectively but the addition of the Greenbird businesses will further boost those figures to revenues of between £70m and £75m and total profit of at least £6m.
Shares in STV closed yesterday's trading unchanged at 230p.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel