SMG, the embattled Scottish Media Group, faces the prospect of a downturn in its television production revenues because it has not yet reached agreement with ITV over whether to recommission its flagship programme, Rebus.

Ken Stott, the actor who plays the Scottish detective inspector, is unavailable for most of next year after taking a part in a West End play. It is believed he would be short of time to film the lucrative show before the end of 2008.

The uncertainty over the future of Rebus, worth an estimated £5 million in revenues annually, or 4.5 per cent of the company’s core broadcasting operation, comes as the shareholders convene today to vote on whether to allow a £95.7 million rescue rights issue.

SMG has conceded in the prospects for the rights issue that its television production arm “derives a substantial amount of revenue from the production of certain programmes, including the award-winning detective dramas Taggart and Rebus”, and that a “failure to secure any new commissions could have a material adverse effect”.

However, SMG said that it was hopeful that it could shoot Rebus — based on the popular series of novels by Edinburgh writer Ian Rankin — in time to book revenues in 2008 if it was recommissioned by ITV for next year. “Filming typically takes place in the second half of the year,” a spokesman for SMG said.

The stage play to which Mr Stott is contracted is God of Carnage, a comedy about two couples that will star Ralph Fiennes. It is due to run until the end of June. But allowing for summer holidays, it may not be possible to start filming until September — a tight turnaround for a high-value drama that this year aired in two short runs in January and October.

Today’s shareholder vote is also expected to be approved with heavy support, with the concerns about the production arm emerging too late to affect the thinking of the City.

However, it will be another month before shareholders have to decide whether to support the rights issue that requires them to buy two new shares at 15p each for every single share they hold.

Mr Stott is represented by Artist Rights Group, which declined to comment yesterday. ARG also acts for Chris Evans, the DJ and presenter who remains a 3 per cent shareholder in SMG. He sold Virgin Radio to the Glasgow-based company in 2000 for £225 million. In its entirety, SMG was yesterday worth £61 million.

This year, ITV bought eight hours of Rebus programmes from SMG, showing them successfully in peak-time. At a typical cost of about £650,000 an hour, the total revenue generated would be £5.2 million, and the operating profits to the company from that single commission have been estimated at £750,000.

Developing the production arm is key to SMG’s recovery strategy, which is based on giving its Tartan ITV1 franchises a more Scottish feel, and in building a successful production business capable of more high-profile commissions.

SMG has tried to hire Alan Clements, the husband of Kirsty Wark, to lead the business, but the would-be recruit is mired in a High Court battle in London with RDF Media, his former employer. RDF wants him to adhere to an original non-compete contract that would prevent him moving until well into next year.

SMG shares added 1p yesterday to reach 19¾p. On the basis of that share price, the price of the stock after the rights issue would be 16½p.

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