Shares in ITV PLC (LON:ITV) came down to earth today after spiking higher late on Friday as hopes for a bid move for the commercial TV broadcaster were fuelled by news that US bank Goldman Sachs’ holding in the group had gone above 25%.
ITV shares shot higher on Friday as Goldman acts on behalf of US cable giant Liberty Global, which itself owns a 9.9% stake in the FTSE 100-listed firm.
But in early morning trading today, ITV topped the blue chip fallers list, down 2.5%, or 4.95p at 213.45p.
In a note to clients, Liberum Capital analysts said: “Having spoken with ITV, it is saying that this is not Liberty increasing its stake but more to do with the way that Liberty holds its ITV stake with Goldmans and related to Liberty loaning out some stock to Goldmans, which in turn has lent out the stock causing the apparent spike in the stated shareholding.“
However, the analysts added: “Obviously, there is a lack of transparency around these transactions and the timing of the RNS (on a Friday afternoon) also looks slightly odd.”
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They added: “Liberty Global’s recent comments have indicated that it is interested in expanding its exposure to TV advertising and it has bought Free to Air TV assets in Belgium and the Republic of Ireland (where it bought both TV3 and UTV Ireland, the latter off ITV).
“The latter exposure is particularly interesting given the obvious similarities between the UK and the ROI both in the FTA market and also with regards to Liberty’s position as the major Pay-TV operator in both countries.”
The analysts added: “Moreover, Liberty has stated that it wants to expand its exposure to FTA TV and the UK market would be an obvious target given its cable assets in the UK, particularly as Liberty is expanding out its network via its Project Lightning programme.”
They repeated a ‘buy’ rating and 340p price target on ITV shares.