The BBC offered Channel 4 a £40million rescue package yesterday in an attempt to avoid handing over its lucrative BBC Worldwide business.

Under the deal the BBC would help Channel 4 to publish Grand Designs and other magazines related to its most popular programming, but Channel 4 immediately rejected the offer, saying that it was worth only £15 million a year.

Ministers and regulators are actively considering a “4 Worldwide” merger plan, as reported yesterday by The Times. The plan is to take BBC Worldwide from the publicly owned corporation and merge it with the state-controlled Channel 4 - something the BBC is desperate to avoid.

Audiences and advertising revenue at Channel 4 are falling and the broadcast regulator Ofcom, which wants Channel 4 to continue to offer its mixture of entertainment and “public service” programmes, believes that the channel will need between £50 million and £100 million a year to survive. Channel 4 says that it will go bankrupt within five years if it does not receive £150 million a year.

Times Archive, 1982: No blank spots as Channel 4 takes off

The new station went on the air at 4.45pm with a trailer composed of clips and then moved into the more conventional world of a quiz from Yorkshire Television

• Review: Channel 4's first night

• Lord Reith's last blast

Related Links

• BBC merger to prevent C4 from going bust

• Cash plan for Channel 4 is dropped

• Channel 4 to cut staff and focus on repeats

BBC Worldwide made £112.5 million in profits last year and its earnings could, in theory, support Channel 4 if there were a merger. But the idea is strongly opposed in some quarters at the BBC, with Sir Michael Lyons, the Chairman of the BBC Trust, insisting that the proposal was a diversion.

“The danger is that this proposal would be massively distracting from the issues in hand,” he said. “The value of Worldwide rests on its relationship with the BBC. If that is severed, its value will be reduced.”

Editor's choice

• The 100 Best Films of the Decade
• 70 facts you didn't know about Marvel
• The 50 Biggest Movies Of 2010