Front-runner drops out of ITV leadership race

ITV's long-running succession drama has encountered fresh troubles after Sir Crispin Davis bowed out of chairmanship negotiations, it was reported today.

The former chief executive of publishing and media group Reed Elsevier was thought to have been a front-runner to replace Michael Grade, who is set to relinquish his dual position as executive chairman of ITV.

But Sir Crispin was turned off the job by the level of publicity it has attracted recently, according to the Financial Times.

The fresh twist comes after the broadcaster's hunt for a chief executive collapsed last month when talks with former BSkyB boss Tony Ball hit the rocks.

ITV - home of hit shows including Coronation Street and X Factor - now plans to select a chairman, who will then appoint a chief executive, but the list of potential candidates appears to be dwindling.

One name still linked to the chairman talks is former Channel 4 chairman Sir Michael Bishop, who retired recently as chairman of BMI British Midland.

A friend of Sir Michael told the FT he was "taking a long, hard look" at the prospects for the job in light of its high profile and the difficulties facing the broadcaster.

It is understood the appointment of Sir Michael could pave the way for talks with Mr Ball to be reopened.

The main stumbling block to negotiations over the chief executive job was thought to be his opposition to the appointment of Sir Crispin.

ITV cited "significant differences" when the talks with Mr Ball broke down.

The negotiations had come under fire for the size of his pay demands - said initially to have been as much as £42m in a share and pay arrangement over five years.

At the time the broadcaster said efforts to select a chairman were "well advanced".

But today a friend of Sir Crispin told the FT: "Crispin has really thought about it and he felt there were risks attached and it was very public, as has been proved over the past few weeks."

ITV has faced several setbacks in its drive to find a replacement for Mr Grade, who was initially set to step down as chief executive, but then decided to withdraw completely during the recruitment process.

The firm has been a victim of the advertising slump in the recession and unveiled a £105 million loss for the first six months of the year.

Its shares have also suffered after the Competition Commission refused to scrap rules about how much the broadcaster can charge advertisers.

Jonathan Barrett, of Singer Capital Markets, said the stock has "taken a ferocious sentiment pounding" recently and predicted the shares would rise on any good news.

"ITV needs somebody at the helm and even the appointment of just a chairman near term would probably be a catalyst," he said.

"With Crispin Davies out of the picture it may also be able to get back to talking terms with Mr Ball again, something that could lift the shares substantially."