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Richard Desmond eyes £700m pay day from Channel 5 sale

Channel 5 owner Richard Desmond is reportedly plotting to trigger a bidding war between BSkyB and BT in the hope of persuading the cash rich pay TV giants to stump up as much as £700m for the station.

Desmond purchased the channel for a mere £103.5m just three years ago but is now eyeing a sale for a much inflated price, despite failing to ever turn a profit from the business.

Dazzled by the recent bidding war which saw BT prise the rights to screen Champion’s League football from Sky’s grasp the canny owner thinks a similar windfall as the pay TV players seek a terrestrial toehold.

Analysts anticipate keen interest for the station from BT, which includes sister channels 5* and 5 USA, as it provides a platform to promote their paid for services and helps broaden their content beyond sport and films.

For its part Sky may seek to place a counter bid to prevent its new rival from continuing its recent momentum.

Thomas Singlehurst, head of European media equity research at Citigroup, said: “It is a really big deal, a fascinating potential transaction because there could be a decent amount of interest from BT and BSkyB for a load of offensive and defensive reasons.

“As well as a boost in TV ad sales from bigger audiences, the [Channel 5] slot on the electronic programme guide could be invaluable, while the extra channels could be used to broaden beyond sport."

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