Endemol CEO resigns, stoking takeover talk

AMSTERDAM, June 8 (Reuters) The chief executive of reality TV producer Endemol resigned on Thursday, reinforcing the widely held belief that the company behind ''Big Brother'' and ''Deal or No Deal'' will be sold soon.

Endemol, traded publicly since November 2005 and with a current market capitalization of 1.72 billion euros (2.21 billion), said that CEO Joaquim Agut was leaving because the Spaniard was tired of commuting between the company's Netherlands headquarters and his home in Barcelona.

Endemol said it would seek to replace him quickly and plans to make an announcement shortly.

Spanish telecoms giant Telefonica sold 22.3 percent of its stake in last year's IPO, and said in late May that it might sell the rest to help fund the possible acquisition of Brazilian joint venture Vivo from Portugal Telecom.

Takeover talk has swirled around Endemol since Telefonica's 180-day lock-up period expired last month.

''We have always expected Agut would resign if and when Telefonica gives up control over Endemol,'' Kempen analyst Oskar Tijs said in a note.

''The press release mentions Agut leaves for personal reasons, but the resignation could also be seen as a confirmation that Telefonica will shortly sell the 75 percent of Endemol it still owns,'' said Tijs, who rates Endemol a ''buy''.

He added that Chief Operating Officer Tom Barnicoat was the most likely internal candidate to replace Agut, who held the post for two-and-a-half years.

Endemol's shares were down 1.2 percent to 13.61 euros at 0952 GMT after initially opening 3 percent lower. The DJ Stoxx media index was down 1.6 percent.

ENDEMOL UPBEAT FOR 2006 ''The supervisory board and management board regret Mr. Agut's decision, but respect it and thank him for his valuable contribution and achievements,'' Endemol said.

Agut told a shareholders' meeting in Amsterdam on Wednesday that Telefonica was in no hurry to sell its stake. He also said Endemol would not do anything to dilute its shares, even as it actively seeks acquisition targets.

Endemol shares have risen more than 50 percent since its November flotation, helped by reports that a number of media companies and private equity firms are possible suitors.

Because of the global nature of Endemol's business, there are very few natural buyers once national broadcasters are taken out of the mix, analysts said.

Media conglomerates such as Time Warner, which reportedly made an approach before the Endemol IPO, and Sony Entertainment , are seen as possible contenders.

FremantleMedia, the production arm of RTL Group behind ''American Idol'', also would normally be considered a strong suitor, but with parent company Bertelsmann AG stretched financially, it is now considered less likely to bid.

''An ISP portal or telecom company that wants to make a big move into content might also be interested,'' said one analyst, who asked not to be named.

Endemol said on Tuesday its strong performance in the first quarter was continuing in the second quarter and it remained confident for the full year.

IT reiterated targets for the year for turnover of at least 5 to 6 percent organic growth and earnings before interest, taxes, depreciation and amortisation margin of 15 to 17 percent.

Analysts have indicated a fair value of 10 to 11 times estimated 2007 EBITDA for Endemol, valuing the shares in the range of 15 to 16.50 euros.

Endemol, founded in 1994 with the merger of two Dutch TV producers, has subsidiaries and joint ventures in 24 countries.

REUTERS CS RS1559