Liberty raises stake in ITV in deterrent to rivals

Liberty Global, controlled by the cable television guru John Malone, has increased its stake in ITV to 9.9 per cent, in a move that could ward off advances on the broadcaster by rivals.

The acquisition by the world’s largest international cable company comes a year after it bought an initial 6.4 per cent stake in the broadcaster. The move makes Liberty the largest shareholder in ITV. The extra stake has a value of around £380m at the market price.

Liberty, which owns the pay-TV and cable company Virgin Media, said that it did not intend to make an offer for ITV – which, under UK takeover rules, bars it from tabling a bid for at least six months.

The company added: “Given ITV’s operating and stock price performance, we were able to increase our stake to 9.9 per cent with no incremental investment by hedging our existing equity position. This investment remains an opportunistic one for us in our largest market.”

Ian Whittaker, an analyst at Liberum, believes the increase could be a move to deter competitors from making a bid for ITV, which this week posted a 25 per cent increase in pre-tax profits. He said: “Liberty has stated it does not intend to make a bid for ITV, but its move suggests that it thinks a move by another player is likely, or, at the very least, an increasing possibility.”

Mr Malone, the veteran US cable tycoon who also controls Liberty Media and Discovery in the US, has been active during the latest wave of consolidation in the industry.

Back in May he sealed a deal that he had been chasing for two years, buying the US broadband and TV group Time Warner Cable in a $55bn (£35m) deal.

At the start of last month he bought Ireland’s free-to-air TV3 channel and also took full control of the sports broadcaster Eurosport.

Mr Malone has also recently been linked with a possible bid for the Formula One motorsports body.

Liberty Global has made €35bn (£25bn) worth of acquisitions in Europe over the past five years, and it recently entered talks with Vodafone over asset swaps after Mr Malone said in an interview that they would be a “great fit”.

ITV, meanwhile, has been buying up TV production companies such as the maker of The Voice Talpa Media.

The update pushed ITV towards the top of the FTSE 100 board, up 9.1p to 280.7p.