Over recent years, the UK film and TV industry has experienced rapid growth, much of this driven by the influx of streaming services and the capital they have helped bring to the sector. This boost helped to propel the industry on, even amid the disruption of the COVID-19 pandemic – which forced the majority of production to a months-long standstill.
COVID boom fuels M&A
M&A across the media and entertainment sector boomed in the wake of the COVID-19 pandemic, at a time when many industries saw pent-up dealmaking demand culminate in heightened activity. However, the sector was one of the few to have experienced a genuine boost during the pandemic (alongside the likes of e-commerce), due to the growth of areas such as streaming during lockdown.Diversification
One of the key trends to emerge over recent years has a diversification of both consumer tastes and means of consuming media content. Amid a seemingly constantly growing array of streaming services and devices on which to watch (coupled with greater amounts of time spent at home during lockdown and since the post-COVID increase in flexible working), viewer tastes have evolved to encompass a wider range of media than ever.In August 2022, production group Zinc Media raised £5 million in investment to acquire The Edge Picture Company in a deal valuing the company at close to a 9.5x profit multiple. The Edge, which has operations in London, Paris, Vancouver and Doha is renowned for its brand film making, having won more than 700 awards over its 15 years of operation.
Zinc Media CEO Mark Browning commented: “The Edge is a truly impressive business – highly-respected, sustainably profitable with a world-class reputation, and we are thrilled that it is joining the Group. The Edge will sit alongside Zinc Communicate, our branded entertainment, corporate film, publishing and audio business, and our award-winning TV businesses.”
“This adds further scale to our Group enhancing our creative, commercial and cultural ambition. It will enable us to increase our branded content offering in the marketplace, both on a domestic and international level, and move into new content markets including animation, e-learning and education.”
Emergence of regions
Crucial to the UK’s recent strength in film and TV has been the emergence of areas beyond London as production hubs. Over recent years, other nations of the UK, as well as cities such as Manchester (which is now home to the BBC’s headquarters) and Cardiff, have established themselves as major parts of the UK industry.Last year, STV Studios, a Glasgow and London-headquartered TV production company, struck a deal to acquire unscripted television production network Greenbird Media. Since it was founded in 2012, Greenbird has developed the largest independent production network in the UK, producing shows including The Misadventures of Romesh Ranganathan for BBC 2 and Lego Masters for Channel 4.
While based in London, Greenbird has an extensive presence across the UK and this was a major factor in STV’s acquisition, with the buyer seeking to become the UK’s leading regions and nations production company. In addition to expanded bases in Glasgow and London, the acquisition also provides STV with bases in Belfast, Manchester, Brighton and Cardiff, which the company said would strengthen its “ability to take advantage of the continuing growth of production in the nations and regions.”
STV CEO Simon Pitts commented: Growing STV Studios into the UK’s number one nations and regions production company is one of our core strategic objectives. This transformative acquisition represents a major step towards that goal, adding significant scale and creative firepower to the group and immediately accelerating STV’s overall diversification in terms of both revenue and profit.”
Inbound investment
The UK’s renewed prominence has led to increasing levels of inbound investment into the sector from international buyers. Even prior to the pandemic, Netflix had created a UK production hub at Pinewood Group’s Shepperton Studios before announcing in 2021 that it would double the size of this base.Popularity of sports continues to drive deals
Another crucial factor in M&A activity in the UK’s tv and film sector has been growing global demand for sport – which includes growing demand in the UK for international sports, international demand for UK sports and the increasing popularity of women’s sports.Headwinds could temper growth
Tailwinds continue in spite of challenges
While the entertainment industry no doubt faces an uncertain future when faced with economic chaos, industrial action within the sector and (for certain major segments of the market) the threats posed by other, emerging forms of media, the sector has, nonetheless, demonstrated considerable resilience in the face of these challenges.Very well established Ltd Co offering wide selection of quality pre-owned vehicles from large secure enclosed site with excellent year-round referral & ‘drive in’ trade in busy suburban main road position.
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