US will switch on to one ITV outfit

TELEVISION faces a momentous week. No, not because Coronation Street dares screen that gay kiss today, but because the Competition Commission will rule on whether Carlton can merge with Granada, completing the coalescence of ITV companies that began in the early nineties.

Though no-one seems to feel that the merger will be completely blocked, it is not beyond the realms of possibility. After all, Granada and Carlton speak for about 52% of the entire commercial television market, and in its decision on the Safeway takeover the commission came down very hard on the idea of anyone having a market share of much more than 26%.

What seems more likely, though, is that the Commission will demand the sale of one or both of the companies' big advertising sales houses. Despite initially claiming this would undermine the rationale for merging, Carlton and Granada now concede they can probably wear it.

But if the companies are allowed to merge, that will fire the starting pistol for an overseas - for that, read American - takeover bid.

Despite their famed temperamental differences, Granada boss Charles Allen and Michael Green of Carlton could find themselves singing rather louder from the same defensive songsheet.

What a shame that would be. I am not saying that the two men have not made mistakes. In fact, their catalogue of value-destroying decisions would fill several issues of the TV Times. They blew at least £1.2bn on ITV Digital by overpaying for football rights, underestimating the competitive response they were likely to face from BSkyB and miscalculating their potential penetration into Sky households.

Until recently they failed to produce progamming that would appeal to either viewers or advertisers. But in the disastrous period for advertising revenues both companies have been through, they have put their houses in order.

They bit the bullet over ITV Digital, they are putting more money into good programming, they have slimmed their operations and they are cutting costs by co-operating on programming and promotion. In short, they now run lean, mean ships. And as the advertising market recovers, every pound from big spenders like Ford or Unilever will simply drop through to the bottom line. The two ITV franchises will again become licenses to print money.

After the pain, what a pity for that benefit to go overseas.

Barclays bungles succession

BARCLAYS' unhappy reputation for slipping on every loose banana skin looked to be a thing of the past. Until, that is, it lurched into a succession crisis entirely of its own making.

To recap, chief executive Matt Barrett has another couple of years to run on his contract. By all accounts, shareholders are not unhappy with the way the high-living Canadian has been running things.

But Barclays' chairman Sir Peter Middleton is due to step down next March. And because, contrary to corporate governance guidelines, the bank wants investors to agree to Barrett stepping up from chief executive to chairman, it has forced a crunch.

A shortlist of potential internal successors has now been compiled.

But what is going on here? Firstly, the bank has no idea whether the notion of Barrett moving up will wash with shareholders, though if investors have stomached the idea of Sir Peter Davis at Sainsbury and Richard Handover at WH Smith doing the same at remarkably less successful companies, Barclays' lack of confidence looks a tad odd.

Secondly, like Abbey National not so long ago, it runs the risk of disenchanting talented executives if they find within the next month that they have been passed over for Barrett's job. Frankly, even the winner might take his eye off the ball if he has to sit out the two years before Barrett's natural tenure expires.

Instead of starting the race for a new chief executive, Barclays should simply have found an interim chairman. Then it could have tried to persuade investors that it was safe to bump Barrett up. And it would not have risked a potential clearout of its most able lieutenants in the process.

No wonder those rumours of a takeover by Bank of America have resurfaced.

Good times, bad times

THE ever-optimistic corporate financier, perhaps mindful of his bonus, has been promising that the moment markets improve, lucrative deals will start to flow. Alas, he did not count on the greed of companies.

The market has definitely warmed up, but a long list of deals that had been on the back burner for months have now been aborted. Companies that agreed terms six months ago now want to renegotiate. Their underlying businesses might not have improved but, they argue, the market pick up means they could be accused of selling too cheaply.

The logic may be correct. But demanding more for a business that is in no better shape than it was six or eight months ago is hardly likely to kick-start the mergers and acquisitions market.