UPDATE 3-Danish TDC prepared to ditch MTG deal after bid approach

* TDC rejected takeover approach from consortium last week

* Will withdraw deal with Sweden's MTG if bid materializes

* Telia says not in talks with TDC board (Adds Telia statement, investor comment)

COPENHAGEN/STOCKHOLM, Feb 12 (Reuters) - Danish telecoms group TDC will abandon its planned $2.5 billion takeover of Swedish MTG's broadcasting and entertainment business if an approach it has received leads to a concrete offer, it said on Monday.

The MTG deal, conditional upon approval of TDC shareholders, was thrown into doubt last week when TDC said it had rejected a $6 billion takeover approach from Australia's Macquarie and three Danish pension funds.

It was not clear whether the approach mentioned in TDC's statement on Monday was from a new bidder or referred back to the Macquarie consortium and TDC declined to elaborate.

Shares in TDC jumped after the latest statement and traded 6.4 percent higher at 46.42 crowns by 1230 GMT.

"The threat of a potential merger with MTG, which could have blocked a takeover of TDC, has been eliminated. The share is reacting positively on that," said Michael Friis Jorgensen, an analyst at Alm Brand Markets.

The TDC stock, which surged by nearly 18 percent last Thursday after its rejection of the Macquarie-led approach, has at no point risen above the 47-48 crowns reported bid price from the consortium.

Sydbank analyst Morten Imsgard said he expected TDC's board would only accept a bid above 50 crowns.

Macquarie was not immediately available for comment, while PFA, ATP and PKA declined to comment.

Portfolio managers at TDC shareholder AllianceBernstein, said they agreed it would be best to drop the MTG deal announced only on Feb. 1.

"We believe the withdrawal of the MTG merger plans leaves the TDC board with the opportunity to pro-actively engage with all interested bidders in the underlying business and extract the best possible long-term opportunity for shareholders," Tawhid Ali and Andrew Birse of Bernstein said on Monday.


The approach marks the latest attempt at consolidating the fragmented Nordic telecoms market and follows continued speculation that TDC could be a target for both private equity and industry players.

However, the prospect of a bidding war for TDC appeared to recede when Sweden's Telia said it was not presently in discussions with its Danish peer.

Telia added it had investigated various alternatives regarding its business in Denmark "which have included also a possible acquisition of TDC."

Citing sources close to the process, Swedish newspaper Dagens Industri earlier reported that Telia had held talks with the TDC board.

The newspaper quoted one of the sources as saying Telia's interest had cooled after the sharp rise in TDC's stock following the approach from the Macquarie consortium.

After Telia and Norway's Telenor had to give up a planned merger in Denmark in 2015 because of opposition from European regulators, an acquisition of TDC was seen as one of the few options for Telia to remain in the country long term.

Less than two years ago TDC rejected a potential takeover approach from another private equity player, believed to be Apollo Global Management.

In 2005 a consortium of U.S. and British funds, including Apax Partners, Blackstone Group and Permira, took control of the company in a 76 billion crown leveraged buyout - Europe's biggest at the time.

(Reporting by Stine Jacobsen in Copenhagen and Johannes Hellstrom in Stockholm, additional reporting by Teis Jensen and Emil Gjerding-Nielson in Copenhagen; Editing by David Goodman/Keith Weir)