[Amy]

LONDON (Reuters) - Endemol, the production company that created the reality TV show Big Brother, is preparing to list on the London Stock Exchange in a flotation worth 2 billion pounds, the Financial Sunday Express has reported.
Endemol, owned by Spanish telecommunications company Telefonica, is thought to have asked investment bank Merrill Lynch to prepare for a listing by the end of the summer, the newspaper reported, citing an unnamed source familiar with the deal.

Telefonica Chairman Cesar Alierta is understood to favour a flotation as it would give the company, whose flagship "Big Brother" is screened in local versions across the world from the UK to Australia, a higher valuation than a straightforward sale, the paper said.

Telefonica was not immediately available to comment on the report.

Alierta has repeatedly said he does not regard Endemol as a strategic asset.

"Telefonica wants to concentrate on what it's good at -- telecoms," the Financial Sunday Express quoted an unnamed source close to the deal as saying.

"It realises it overpaid for Endemol and won't sell out for offers so far away from its investment in the company. Just last week Agut (Joaquin Agut, Endemol's chief executive) was discussing the float with his bankers."

Telefonica paid 5.5 billion euros (3.8 billion pounds) in shares to buy Endemol in 2000, hoping to capitalise on the success of its "Big Brother" TV formula, where strangers are locked in a house and gradually voted out by the audience.

Article Reuters