Under rules contained in the TV3 shareholders' agreement, the British company will be forced to sell its 45% stake in TV3 to the highest bidder unless it buys Canwest's 45% stake l.

This means that Canwest's decision to put its stake in TV3 on the market has effectively triggered a full sale of the business, which could be worth about 200m. It had been thought previously that only 45% of the business was for sale, but by the time the sale process is complete a single entity will own 100% of TV3. It is understood that the Irish investors who own 10% of the business, including the company's founder and chairman James Morris, will be pulled into any deal.

Under the shareholders' agreement, ITV has the first option to buy the Canwest stake. If management at ITV choose to exercise this right, ITV will automatically also acquire the 10% of TV3 held by the Irish investors. If ITV fails to take up its option, then the British company must sell its stake in TV3 alongside the Canwest disposal and the new owner of the business will also acquire the 10% held by the Irish investors.

Canwest has hired Londonbased merchant bank Hawkpoint to handle the sale of the TV3 business, and an initial 10-page teaser document has already been dispatched to a number of interested parties. This document, which has gone out to potential trade and financial buyers in Europe and elsewhere, indicates that it is Canwest's intention to structure "a 100% sale" of TV3. The initial teaser also shows that TV3 made an operating profit of 15.3m on a turnover of 48m in the 12 months to last August.

While ITV is still seen as favourite to buy TV3, this outcome is by no means a foregone conclusion, according to well-placed sources. Other potential bidders include Ulster Television, Setanta, Sky, Luxembourg-based RTL, Swedish broadcaster SBS and Silvio Berlusconi's Mediaset. UTV is part of the ITV network, but it is a standalone company with no corporate connection to ITV.

TV3 gets much of its current programming from ITV, and the exact nature of the contract between the two firms will be closely studied by potential bidders. It is not clear when the current programming deal expires, or whether TV3 pays the market rate for ITV shows.