US private equity predators on Tuesday made their long-expected move on ITV, the UK's largest commercial broadcaster, according to the Daily Telegraph.
Formed in 2003 by the merger of Carlton Communications and Granada - then the two largest members of a consortium of regional TV companies - ITV commands around 40% of Britain's television advertising market.
Despite which, it has steadily lost market share in the face of media proliferation exacerbated, many shareholders and media observers believe, by lacklustre management.
Now two of Wall Street's most aggressive private equity groups - Goldman Sachs Capital Partners and Apax Partners - have made their move. They propose a capital injection of £1.5 billion ($2,62bn; €2.17bn) in return for an equity stake that, to all intent and purpose, hands them control of the company.
Under the proposed deal, ITV remains a publicly quoted company, with existing shareholders offered a significant equity stub, enabling them to remain co-invested alongside the US duo.
Lurking in the wings, meantime, is none other than Greg Dyke, a former director of London Weekend Television, a member of the quondam ITV consortium, and now an 'advisor' to Apax.
Dyke, better known as the ex-director general of the BBC, was forced to resign after his run-in with the Blair administration over the BBC's reporting of events leading up to the Iraq aggression. If the bid is successful he is expected to take an executive role in ITV.
The move has raised few eyebrows in UK media and financial circles. It was foreseen prior to ITV's formative merger and the introduction of the Blair administration's Communications Bill which removed restrictions on the ownership of UK TV companies by non-EU based investors. The only uncertainties were when - and by whom?
If the Goldman/Apax overtures meet with a sympathetic response, observers of the UK media scene predict a night of the long knives at ITV, with ceo Charles Allen among the first casualties.
It is also thought unlikely the private equity duo will be long-term investors in ITV, their most likely strategy being to beef-up the broadcaster for takeover by Time Warner (with whom the duo have been associated in the context of ITV) or another multinational media giant.
The lips of ITV, Goldman Sachs, Apax and Dyke remain firmly sealed.
Data sourced from Telegraph.co.uk; additional content by WARC staff
