LONDON — A report that Time Warner is preparing a bid for ITV, Blighty’s biggest commercial terrestrial web, sent the broadcaster’s stock soaring here on Monday.
Shares in the web rose 8% to 134.75p ($2.37), a 15-month peak, in early trading before dipping back to $2.26.
New speculation about a possible takeover was in the cards following last week’s announcement from U.K. media regulator Ofcom that ITV’s annual license payments are being slashed by more than $234 million.
According to the latest report, in the Mail on Sunday, Time Warner is preparing a bid at $2.90 a share, backed by private equity group Apax and investment bank Goldman Sachs.
This is not the first time Apax has been linked to a possible takeover of ITV.
Veteran British TV topper Greg Dyke, an adviser to Apax who has run both ITV and the BBC, was named as a potential leader of the bid.
Analysts and commentators have been impressed by the cost-cutting strategy of ITV chief exec Charles Allen, whose lobbying skills delivered the cuts to the license fees.
But Allen’s strategy, claim critics, has failed creatively as the audience share of ITV flagship net ITV1 has plunged.
A week ago ex-ITV helmer Brian Tesler, who originally promoted Dyke at London Weekend Television, called on Dyke to lead a takeover of ITV.
Speaking at a lunch hosted by the Royal Television Society, Tesler said, “I think it is unfortunate that ITV is run by a businessman, by a manager, rather than a program maker who is also a businessman. The pressures are therefore very considerable on ITV.”