NTL drops ITV bid, takes BSkyB to regulators

Mumbai: Cable firm NTL has dropped its 4.7-billion-pound ($9.3 billion) bid to acquire ITV, the UK's biggest commercial broadcaster, after rival BskyB bought a 17.9 per cent stake in the company. ITV rejected NTL's proposal after satellite TV group BSkyB swooped to take the blocking stake at 135 pence a share.

NTL had last month offered to make a cash and shares bid for ITV worth 122 pence a share at November 9 prices.

Sources, however, said NTL is unlikely to abandon its plans and may make a fresh bid if it succeeds in its campaign to persuade regulators to force BSkyB to sell its stake in ITV.

NTL's biggest shareholder, Richard Branson, had complained about BSkyB's move to Britain's Office of Fair Trading and to media regulator Ofcom.

An NTL statement merely said, "NTL announces that it has no present intention of making an offer for ITV, as it believes a transaction between ITV and NTL is unlikely to be attained on terms acceptable to NTL."

ITV, struggling with a steep drop in audiences and advertising revenues amidst rising competition from proliferating digital channels, received a boost late last month when it managed to rope in BBC's Michael Grade as its new executive chairman.

NTL also completed takeover of smaller rival Telewest earlier this year, which it is planning to rename as 'Virgin Media' early next year following its recent purchase of Branson's Virgin Mobile group.

ITV would provide NTL with much-needed programming as it seeks to sign up internet, mobile phone and TV subscribers to an increasingly cut-throat market.

However, NTL is facing opposition from its own shareholders over the pursuit of ITV who want the company to focus on integrating its recent acquisitions.