Cable firm NTL yesterday abandoned its plans to bid for ITV after its #4.7 billion proposal was rejected by the broadcaster and rival BSkyB swooped to take a blocking stake in ITV.

"NTL announces that it has no present intention of making an offer for ITV, as it believes a transaction between ITV and NTL is unlikely to be attained on terms acceptable to NTL," NTL said in a statement.

But a source close to the matter said NTL may take a fresh look at Britain's biggest commercial broadcaster if it succeeds in its campaign to persuade regulators to force BSkyB to sell its stake in ITV.

"Once the clouds are parted on that, we'll think about it. But at the moment, it's far too early," the source said.

NTL said last month it was prepared to make a cash and shares bid for ITV worth 122 pence a share at November 9 prices.

ITV rejected the offer, saying there was "little, if any, strategic logic for ITV to combine with NTL".

NTL's plans were also dealt a huge blow when satellite TV group BSkyB swooped to take a 17.9-per cent stake in ITV at 135 pence a share.

NTL, whose biggest shareholder is entrepreneur Sir Richard Branson, has complained about BSkyB's move to Britain's Office of Fair Trading and to media regulator Ofcom.

"It presents serious competition and public interest issues," NTL said in its statement.

Analysts have said it is likely to take months for regulators to make a decision and BSkyB has said it is confident its stake does not break any competition rules.

Panmure Securities analyst Alex DeGroote said NTL's decision was widely expected, but could still weigh on ITV's shares.

"There are no obvious alternative bidders and shares are likely to drift lower with the bid premium taken out of price," he wrote in a research note.

ITV is struggling with a drop in audiences and advertising revenues amid growing competition from a proliferation of digital channels. But it received a boost late last month when it poached Michael Grade, the chairman of the British Broadcasting Corporation, to be its new executive chairman.

NTL, which fell to the brink of bankruptcy in 2002 after the bursting of the dot-com bubble, completed its takeover of smaller rival Telewest earlier this year and will change its name to "Virgin Media" early next year following its recent purchase of Richard Branson's Virgin Mobile group.

Buying ITV would provide NTL with much-needed programming as it seeks to sign up internet, mobile phone and TV subscribers to an increasingly cut-throat market.

But sources close to the matter said some NTL shareholders were keen for the firm to end its pursuit of ITV and focus on integrating its recent acquisitions.

One person familiar with the matter, however, said the opposition was entirely from short-term investors hoping that NTL itself would receive a takeover bid.

"The long-term investors were all supportive," that source said.

Sources close to the matter said in August that a consortium of private equity firms had approached NTL about a possible takeover, but the talks came to nothing.