ITV CEO Downplays Takeover Chatter

LONDON -- The stock of U.K. commercial broadcaster ITV rose in early Wednesday trading following a better-than-expected 2012 earnings report and news of a higher-than-expected dividend payment before falling after management comments about recurring buyout rumors.

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During an earnings conference call, ITV CEO Adam Crozier downplayed the potential of a near-term takeover of the company. Market chatter about an acquisition, most likely by private equity or other financial companies, has been recurring in recent years. Citigroup last week included the company on a list of potential acquisition targets.

But asked whether he has received calls from private equity groups interested in a takeover of ITV, Crozier on Wednesday said "absolutely none at all."

ITV's stock initially rose, but failed to set a new 52-week high as observers said investors had also been expecting strong earnings.

ITV's stock went as high as $1.86 (£1.23) in early trading. Its 52-week and multi-year high stands at $1.89 (£1.25). The stock is up 53 percent over the past year. But it started declining in mid-morning trading. As of 12:40pm London time, it was down 2.7 percent at $1.77 (£1.17).

UBS analyst Tamsin Garrity maintained her "buy" and £1.45 price target on the stock after the earnings report.

"Results and outlook are strong with 2012 ahead by 2 percent-3 percent, cash returns exceeding expectations and 2013 advertising starting well and cost below expectation," she wrote in a report. She predicted that all this "should lead to consensus [earnings] upgrades of high single digits."

Sanford C. Bernstein analyst Claudio Aspesi also lauded ITV's latest results in an investor note entitled "Another Day, Another Upset Win." He maintained his "outperform" rating on the stock.

Email: Georg.Szalai@thr.com
Twitter: @georgszalai