UTV, ITV and Setanta Media are among the companies believed to be interested in the 45 per cent stake in TV3 put up for sale by Canadian company CanWest Global.
The companies have refused to comment officially, but sources have indicated that all three are likely to receive copies of the sale memorandum being prepared by the company's advisers, London-based Hawkpoint Partners.
ITV is in the strongest position as an existing shareholder, with a 45 per cent stake. It is believed to have pre-emption rights to the shares, meaning that CanWest will have to offer its stake to ITV before accepting a bid from any other party.
It is understood UTV is also keenly interested in the stake. However, it will want clarity on the relationship between ITV and TV3 itself. It is understood ITV provides a large amount of programming to TV3 and any buyer will want certainty about this continuing, regardless of what happens to the CanWest stake.
A market source said yesterday: "The programme supply agreement between TV3 and ITV is crucial to all this. Potential bidders will want to know its value, when it runs out and whether ITV are prepared to continue it long term, even if other shareholders take up the 45 per cent stake."
Another source said TV3's schedule would be "seriously depleted" if all ITV programming was removed. Among TV3's main ratings winners is Coronation Street, which is owned by ITV.
Some market sources suggested yesterday that CanWest had been trying to sell its stake for some time, but ITV had shown no willingness so far to buy. TV3 has refused to comment on the sale process while it is ongoing.
Goodbody Stockbrokers, which acts for UTV, said yesterday it expected the company to be interested in the stake.
"UTV is also a likely bidder for the stake in TV3, but success may be dependent on ITV withdrawing from any contest," said analyst Neil Clifford yesterday.
Goodbodys put a value of €80-€90 million on the stake, although this is only an estimate.
A spokesman for Setanta Media, which owns the Setanta Sports channel, said that the company would not be making any comment.
Its links with venture capital company Benchmark Capital would help it mount a bid, though ITV remains the firm favourite in the eyes of most observers. Last night, bookie Paddy Power made ITV the odds-on favourite to buy the CanWest shares.
If ITV goes ahead and purchases the shares, it is likely that Irish shareholders like Paul McGuinness and Windmill Lane Ltd will also exit the business. This group owns 10 per cent of the equity.
The first few years of TV3's existence were tough financially, but last year it recorded its first pretax profit. 2006 is likely to be a very strong year, with television advertising revenue expected to rise sharply.
