ITV rallies on bid chatter
Shares in ITV rallied on Tuesday following a report Virgin Media owner Liberty Global could be facing competition from some of the world’s largest companies to buy out the London-listed broadcaster.
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Speculation has been rife that Liberty Global is looking to buy ITV, but according to the Evening Standard, major shareholders of ITV have been sounded out by the likes of Apple, Amazon and Netflix about a possible takeover.
ES said chatter suggests the US giants are prepared to cough up 300p a share for ITV, valuing the group at around £12bn.
It cited sources as saying that the purported interest could prompt Liberty Global, which has a near-10% stake in the company, to bid for the entire group.
Atif Latif, director of trading at Guardian Stockbrokers, said: “With evidence of stability in the UK television space and rising advertising revenues we see scope, as we have said before for ITV to be a ripe candidate for M&A. With this in view, value extraction can become the preferred way for ITV to capitalise on creating greater shareholder value. More on point is the ability of overseas companies, given the FX differential, to be able to position and buy ‘cheap’ assets at the current price but they would have to offer much above the current levels, given that the upside is still in its infancy and has more to run. Fair value as a standalone company closer to £2.50 but take out value above £3.
“Is Liberty a credible candidate, with a near-10% holding? Yes, but we also remain of the opinion that there are others in the frame too. With Sky having had a bid then it's very much a possibility ITV will be on the shopping list given that the television space is poised for recovery.”
At 1420 GMT, the shares were up 5.7% to 212.90p.