Top > Business > 2006 > November > 2006-11-26

ITV Takes a Dive

The British television broadcaster, ITV, lost 5% of its share value Monday after news of the purchase of 17.9% of the company for $1.78 billion by Satellite broadcaster BSkyB hit the shocked financial world. The move created quite a bit of uncertainty regarding the company`s future as the move killed the anticipated takeover by NTL, a television operator that has been in talks with the company.

Sir Richard Branson, who is the company`s largest shareholder since receiving 10.5% of the company`s shares in exchange for Virgin Mobile, has requested the Office of Fair Trading force BSkyB sell what it has bought, saying: "BSkyB`s move is a blatant attempt to distort competition even further by blocking any attempt to create a strong and meaningful competitor," Sir Richard added "BSkyB is positioned to strongly influence ITV`s operations in a manner that favors BSkyB`s long-term plans rather than the interests of the other 82% percent of ITV shareholders who weren`t offered a sweetheart deal on Friday."

BSkyB has denied the allegations saying "Sir Richard seems to believe that he and his partners in NTL-Telewest have a unique right to acquire ITV," adding that the British law allows the satellite broadcaster to own up to 20% of ITV. There have been many rumors regarding the purchase of ITV. Some reporting German broadcaster RTL intends to make a bid for the company, who has in recent years lost much of its revenue from advertising and currently doesn`t have chief executive officer. But these rumors seem to have been made irrelevant by the news.