BROADCASTER ITV's shares surged by three per cent yesterday amid speculation that a group of investors, including US media conglomerate Time Warner was planning a £6.6bn takeover.

Talk of a bid, which may be led by former BBC director-general Greg Dyke, sent shares to their highest level in 15 months.

According to one Sunday newspaper, venture capital group Apax Partners and investment bank Goldman Sachs are also involved in the consortium with Time Warner.

Mr Dyke, who is an advisor to Apax, was named in reports earlier this year as a likely leader of a bid for ITV.

Speculation about a possible takeover has lifted shares from a low of 94p. Latest reports said an approach by Time Warner would value the shares at 165p.

ITV, which was created last year by the merger of Carlton Communications and Granada, recently announced a 57 per cent rise in annual profits in its first full-year results as a unified company.

It said at the time that a combination of rising turnover and lower costs since the merger had contributed to the profits surge.

The group was boosted last week by industry regulator Ofcom's announcement that it was cutting the amount ITV paid for its licences to help it cope with the challenge of the digital age.

Ofcom is proposing to cut the cost of ITV's dozen licences, including GMTV, to less than £80m this year - down from the £215m paid last year. The regulator also paved the way for further reductions in licence fee payments beyond this year.