Hunt for ITV chief executive back on as Tony Ball talks collapse

ITV said it has negotiated "exhaustively" with Ball but conceded the negotiations revealed "substantial differences" of opinion. These included a failure to agree contractual arrangements, together with a disagreement over the future chairmanship of the company.

"The committee has therefore concluded that it would not be in the best interests of the company to appoint Ball as ITV plc's chief executive," ITV said.

In an unexpected move, ITV said that Grade will leave the broadcaster. It was previously expected Grade would stay on as non-executive chairman once a new chief executive is appointed. ITV said today it is close to appointing a new non-executive chairman to replace Grade, who has combined the roles of chief executive and chairman since November 2006.

"The first task of the new chairman will be to appoint a new chief executive," ITV added, which suggests that the new search for ITV's next chief executive might not start immediately.

Grade will continue to lead ITV as executive chairman until the new non-executive chairman is appointed and in place.

The termination of talks with Ball is a huge blow to ITV, which, along with head-hunter Russell Reynolds, must now appoint a new chief executive within the next three months. ITV has previously stated that Grade will relinquish his executive chairman role by the end of the year.

Talks between Ball and ITV are thought to have been ongoing for weeks. Reportedly, however, the two sides could not come to agreement over Ball's remuneration package, with the former BSkyB chief executive holding out for a five-year package that could be worth up to £30m. ITV reportedly offered a five-year deal that would have netted Ball up to £20m if he had hit all performance targets.

Ball became the frontrunner for the ITV chief executive role after Simon Fox, the chief executive of HMV, reportedly withdrew his name from consideration.

Ball's exit from the frame leaves the door open to a number of other potential candidates. Observers expect these to include John Cresswell, ITV's chief operating officer, Rupert Howell, ITV's managing director, brand & commercial, and, Malcolm Wall, the former chief executive of Virgin Media's content arm.