LONDON, U.K.: British broadcaster ITV said it is in negotiations with Sky, the pay-TV company owned by Comcast, over a possible sale of its media and entertainment (M&E) division for £1.6 billion (US$2.15 billion), including debt.

ITV's M&E division includes its free-to-air channels and the ITVX streaming platform, both of which are heavily reliant on advertising. The company has been hit hard by weakness in the ad market and said this week its advertising revenue would be nine percent lower in the final quarter of the year.

The potential sale, first reported by Bloomberg, remains at an early stage. ITV described the discussions as "preliminary."

ITV, which has a market capitalization of £2.53 billion, has seen its shares trade at levels similar to those of 13 years ago. The British company traces its history to the regional TV franchises launched in the 1950s and has built its Studios production business to help offset volatility in advertising.

The Studios business has been the subject of takeover speculation in recent years. Reuters reported earlier this year that ITV held early-stage talks with RedBird IMI, an Abu Dhabi-backed group, about a possible merger of their production units. French media company Banijay has also reportedly held discussions about a potential offer for ITV's studio business or a complete takeover.

In July, ITV said its M&E unit generated £955 million ($1.28 billion) in revenue and £35 million in adjusted earnings before interest, tax, and amortization in the six months to the end of June.