The firms, together with Goldman Sachs Group Incs buyout unit, offered to buy a controlling stake in the broadcaster, take out more debt and then return cash to investors, London-based ITV said in a statement on Wednesday. The plan was not in the interests of all shareholders, said ITV, which has a market value of about 5 billion-pound ($8.7 billion).
Apax, whose advisers include former British Broadcasting Corp director General Greg Dyke, approached ITV as ratings decline at its biggest and oldest station. ITV has diversified by adding entertainment channels, including one aimed at men and buying Web site operator Friends Reunited Ltd.
Profit jumped 62% last year on higher ad sales at its digital channels. ITV is attractive because there is the possibility of further cost savings, said Redwan Ahmed, a London-based analyst at Oriel Securities. Apax has Greg Dyke on board now and he obviously thinks he can do a better job than the current executives, he said.
Shares of ITV rose as much as 12.75 pence to 129.75 pence and traded at 125 pence in London. At the intraday high it was the biggest gain since ITV was formed by the combination of Granada Plc and Carlton Communications Plc. In February 2004.
After the merger, investors, including Fidelity Investments lobbied ITV to replace chief executive officer Charles Allen with Dyke, the Observer newspaper reported in May 2004. Dykes former employer, the BBC, is the UKs biggest broadcaster.