Statement re Disposal

Channel Television Group Ld
14 June 2000


CHANNEL TELEVISION GROUP LIMITED 
 

Channel Television Limited has been sold to a management buy in team, Media
Holdings Limited, in a deal which also includes Creative Channel Limited, the
television commercial and corporate production business.  
 
Channel Television Group Limited ('CTG'), the AIM quoted Jersey registered
company, has announced the sale of its subsidiary Channel Television Limited,
the ITV licensee for the Channel Islands, for a price of £16.3 million in
cash. 
 
CTG will retain the freehold of the premises in Jersey and Guernsey from
which the television service and other businesses operate and has agreed to
lease part of those premises to Channel Television Limited for a 10 year term
at an initial annual rent of £600,000. 
 
The new owners of the local television company include former directors of
other ITV stations with many years combined experience in the broadcasting
industry. The new Chief Executive is Huw Davies, former Group Director of
Television at HTV, the ITV licensee for Wales and the West of England and
former Chief Executive of HTV Wales. The new Finance Director is David
Jenkins, former Finance Director of HTV Group. Michael Lucas, Managing
Director of Channel Television Limited since 1997, is staying with the
company to continue to oversee the local programme service. He resigned from
CTG's Board yesterday. There will be no staff redundancies. 
 
Media Holdings Limited have been advised by KPMG Corporate Finance and backed
by the media focused venture capitalist Friends Ivory & Sime Private Equity
plc and Royal Bank of Scotland.  
 
The service which Channel Television provides is licensed and regulated by
the Independent Television Commission. Under the licence granted by the ITC,
which became effective in 1993 and is due for renewal in 2002, the company
has programme obligations which will continue under the new ownership. The
ITC has extensive powers aimed at ensuring that there is no diminution in the
quality and range of the regional programme service provided.  
 
'This deal is clearly in the best interest of our shareholders and, at the
same time, secures existing staff arrangements and the quality of the local
service for viewers', said Tom Scott, Chairman of CTG. 
 
'Michael Lucas and his team are doing an excellent job in providing the
Channel Islands' television service, and we do not plan to make any changes.
We do intend to grow the production arm of the company and to make Channel
Television, and indeed, if we can, the Channel Islands themselves into an
important base for production, not only for the British Isles but for the
world market', said Huw Davies, new Chief Executive of Channel Television. 
 
The consideration for the sale (which includes Creative Channel Limited, the
television commercial and corporate video production business and a
subsidiary of Channel Television Limited) is £16,310,000 which was paid in
cash at completion last night. 
 
The current net asset value of the businesses sold is approximately
£1,180,000 and the profits of the businesses before interest and tax for the
year ended 31st March 2000 were £1,517,000. The preliminary announcement of
CTG's results for the year ended 31st March 2000 will be made in July. 
 
The sale results in CTG having net cash in excess of £17.5 million and it
retains significant property assets in both Bailiwicks. In Jersey
approximately 3.25 acres of freehold commercial property in St. Helier
includes 12,000 square feet of surplus office accommodation with planning
permission for a further 15,000 square feet of new offices. In Guernsey the
recently modernised freehold property in St. Sampsons also has surplus
capacity. 
 
The Group's trading activities include Channel Rentals and Cinebank, the
television, video and tape rental businesses with net assets of £2.2 million
and Channel Publications which publishes the advertising freesheet, Guernsey
Homefinder, and a range of maps and guides under its Perry's banner. 
 
Reflecting on the sale of Channel Television Limited Tom Scott said,
'Clearly, the Group will be taking a new direction. Future plans will be
discussed at our Annual General Meeting later this summer, but the directors
believe the proceeds of the sale exceed the requirements of the Group's
remaining businesses and intend to make arrangements to return a proportion
to shareholders in due course.' The directors have also agreed to propose a
change of CTG's name to avoid confusion. 
 
Enquiries: 
 
CTG:                         John Henwood          Tel.     [phone] 
                         Charles Day               Tel.     [phone] 
 
Media Holdings Limited          Huw Davies         Tel.     [phone] 
                         David Jenkins             Tel.     [phone] 
 
Friends Ivory & Sime Private Equity plc 
                         Robin Lincoln             Tel.     [phone] 
 
KPMG Corporate Finance          David Elms         Tel.     [phone]