ITV settled at its highest level this year amid speculation that Time Warner, the heavyweight US media group, has joined forces with supposed long-time stalkers Apax Partners and Goldman Sachs.

The shares, some 127 million of which changed hands, touched 132p at their best as investors bet that a mooted 160p bid might actually be on. This was helped by the idea that Greg Dyke, the Apax adviser and former BBC DirectorGeneral, had finally gathered enough fire power for a record-breaking £7 billion bid.

Time Warner is certainly a plausible bidder, if only because the American company is known to be interested in television and television production businesses in Europe.

Richard Parsons, chief executive, is understood to believe that the company has run out of growth opportunities at home because the prospects for mergers and acquisitions are now limited. But it is not clear why a company so large would need to team up with equity.

Seasoned hands also noted that the Takeover Panel had not forced either side to make a statement. ITV is not in offer talks with Time Warner/Apax, and so had nothing to say.

However, the panel’s failure to push the would-be bidders into any kind of confirmation left the impression that the tale lacked substance as the day wore on.

Both Apax and Time Warner, which was forced to rouse itself on the Independence Day holiday, declined to comment or provide any guidance.

As momentum faded, the shares eased, closing up 3¾p at 128½p. Interestingly, ITV’s convertible shares added 9p to close at 49p. These securities, which could amount to about 3 per cent of ITV, will convert into ordinary ITV shares should the ordinary shares stay over 140p for 60 of the last 90 days of 2005.

The wider index continued to be driven by further gains in crude futures, helping the FTSE 100 up 32.3 to 5,184.3, a three-year high.

BP put on 23p to 617p as Citigroup raised its price target by 7 per cent to 650p ahead of today’s quarterly trading update. Jonathan Wright, analyst, points out that BP has recently underpeformed Shell, up 10¼p to 563¼p, ahead of the latter’s increased weighting in the FTSE indices due to come into effect on July 20, but believes this trend will change during the second half.

Rio Tinto gained 22p to £17.46 as analysts at Credit Suisse First Boston wrote positively of Friday’s purchase of a 50 per cent stake in the Hope Downs iron ore project in Western Australia..

William Hill dipped 7p to 540p ahead of today’s trading update, which is expected to show little improvement since May against tough comparative figures last year.

• NEW YORK: Wall Street was closed for the Independence Day holiday.

Explore Markets

• United States

• Europe

• Japan

• China

• Russia

• The Gulf

• India

• Africa

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive