It was a case of third time lucky for Mr James Morris when his 10-year courtship of Granada came to fruition yesterday. The decision by the British media group to take a 45 per cent stake in TV3 for £38.05 million (€48.31 million) - bringing with it Coronation Street - has strengthened the two-year-old station and sent shockwaves around RTE's management at Montrose.

Mr Morris and Windmill Lane Pictures - his Dublin TV and recording studio - stand to receive about £3.24 million in the complex deal. The 45 per cent being bought by Granada Media includes the 35 per cent of the company owned by ACT Venture Capital and half of the 20 per cent stake of the founding consortium.

Mr Morris and Windmill Lane have a 60 per cent stake in the consortium while the show business accountant, Mr Ozzie Kilkenny, holds 22 per cent and Mr Paul McGuinness has just under 17 per cent. Mr Kilkenny should receive about £1.18 million and Mr McGuinness just less than £1 million, on the basis of their shareholdings.

Granada Media and CanWest, the Canadian media group, will hold 45 per cent each while the original consortium will retain a 10 per cent stake. Mr Morris will remain as non-executive chairman. Although Granada will nominate a number of directors, the day-to-day management of the company will be left to the current team, headed by TV3 chief executive officer, Mr Rick Hetherington, according to Mr Steve Morrison, the chief executive of Granada Media.

The British group was one of the first companies that Mr Morris approached 10 years ago when he had the idea to try and establish an independent TV station in Ireland. He also spoke to them a second time when after a protracted legal battle he won back the licence for TV3 and began looking for partners, ending up with CanWest and ACT.

Yesterday's deal followed a third approach to Granada from Mr Morris and CanWest earlier this year about buying the Irish rights to Coronation Street, which would become available at the end of the year.

The possibility of Granada taking a stake in TV3 came up in the negotiations and was seen as the key to the deal by Granada which was also in talks with RTE.

"We had a very good relationship with RTE who were keen to partner us, but given their status they were not able to invite us into the equity of the channel," explained Mr Morrison.

In order for the deal to go ahead ACT had to agree to sell its shares. "We were very pleased with the price we got, but would have been happy to stay in longer," said Mr Niall Carroll of ACT yesterday. The company never disclosed the price paid for the original 35 per cent stake but it will get in the region of £18 million for its shares.

The role of Granada Media will be to "provide investment, board directors and advice," said Mr Morrison yesterday. The deal announced yesterday will allow TV3 to offer Granada programming on the three digital TV channels it expects to get under the proposals currently before the Government for inclusion in the Broadcast Bill. Granada currently has joint ventures with Manchester United, Liverpool and Arsenal football clubs and it is expected that opportunities in this area will also be explored.

The two large shareholders have also agreed to work together to encourage co-productions with Irish television production companies.

Granada already sells advertising for TV3 in the UK through Granada Enterprises and will continue to do so. It will also undertake to seek sponsorship for programmes such as Coronation Street.

"We expect that the new programming will a have a significant impact on TV3 advertising," said Mr Morrison.

Mr Morris declined to speculate on the boost that TV3's ratings will get on the back of Coronation Street, currently the highest rated show on RTE. TV3 will also get the rights to show Emmerdale, London's Burning and Heartbeat. "It will accelerate the rate at which we will grow into a substantial channel," he said.

At present TV3 has between 15 and 18 per cent of the Irish TV advertising market, while RTE has in the region of 80 per cent, he said. The smaller company's share of TV viewers is around 10 per cent compared to RTE's 50 per cent.