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BSKYB’S FORCED TO FLOG £200M OF ITV SHARES

ABOVE: The X Factor is a huge hit on ITV, with Joe McElderry winning the contest in December

9th February 2010

By Bill Martin

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BSkyB has given up a two-year legal battle by selling £200million worth of shares in ITV.

The satellite group has sold a 10.4% stake in the business, home of the X Factor.

It means the TV giant’s remaining holding in ITV is one share below 7.5%, the level demanded by competition authorities.

Investment bank Morgan Stanley is handling the sale. It is believed to have placed shares at between 48½p to 49½p with investors.

At an average of 49p, it means Sky will make a loss of about £345m on the stake it is selling. The forced sale may spark more bid speculation in ITV, with any buyers of the shares using them as a springboard to launch a takeover bid.

But it is believed the 10.4% has been placed with several investors. Rival media groups said to be interested include Channel 5 owner RTL, Italy’s Mediaset and Disney.

Sky had been arguing against having to reduce its stake since January 2008 when the Government upheld the Competition Commission’s ruling it should be cut to below 7.5%.

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