The team, comprising Goldman Sachs, Apax Partners and Blackstone, issued a statement yesterday evening saying it was reviewing its position following the ITV board's public rejection earlier in the day.
It said it was mulling a takeover offer for ITV, in addition to the option reported yesterday of injecting £1.3bn into the company to create new shares and dilute the stakes of existing shareholders. This course would give the consortium a 48% stake. Its strategy is believed to be to invest in primetime and sports programming.
"The consortium has been in discussions with ITV regarding a confidential proposal involving the investment of a substantial amount of new capital, in exchange for a minority shareholding. This proposal could be structured, subject to the approval of the Board of ITV, in a number of ways, including the consortium subscribing for new equity in ITV or the consortium making an offer for ITV.
"The Consortium is reviewing its position and a further announcement will be made if appropriate," its statement said.
Reports today claim that one of ITV's major shareholders, fund manager Fidelity, which owns 14%, is supportive of the approach. Fidelity was instrumental in the creation of a single ITV out of the merger of Carlton Communications and Granada. Other major shareholders, UBS with 15.5% and Brandes with 7%, have been sounded out by the consortium.
However, Fidelity's attitude towards Greg Dyke taking over from chief executive Charles Allen as ITV boss is unclear. Dyke, the former director-general of the BBC, has been an adviser to Apax since October 2004.
Analysts and observers have posed a number of questions about the equity injection deal, the amount of debt envisaged and Dyke's involvement.
One major concern is that current shareholders would not receive a premium for allowing the consortium to take control.
Secondly, analysts said the massive increase in debt necessary to do the deal was risky for an advertising-reliant company like ITV. Its current net debt of £481m is roughly equivalent to last year's pre-tax profits of £452m. The consortium would increase debt to £3.5bn, more than seven times profits.
"Applying such a significant gearing to a cyclical, highly operationally geared business as ITV dramatically increases the risk profile of the group," Numis said.
The possibility of Dyke succeeding Allen as chief executive had industry sources questioning how Dyke would deal with ITV's relationship with regulators. Allen has been widely praised for securing concessions from Ofcom such as reducing public service output and the cost of analogue broadcasting licences.
The approach has already had knock-on effects in the television industry, forcing BBC to deny that its chief operating officer John Smith has been offered a role by Dyke.
ITV's share price this morning was 128p, unchanged from the level it climbed to yesterday on the news of the approach.
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