Richard Desmond
A file photograph of Channel 5 owner Richard Desmond.Reuters

A second round of bidding for broadcaster Channel 5 is expected to attract bids of between £200m and £300m, less than half the amount its owners were hoping to raise.

Richard Desmond, who also owns the Daily Express and Daily Star newspapers, is looking to sell his TV business at £700m ($1.2bn, €844m), 10 times the estimated £70m profit it makes each year.

However, second-round bids for the company are expected in the range of £200m to £300m, according to sources cited by the Daily Telegraph.

The decline in the company's valuation comes after prospective buyers were allowed greater access to its accounts, following the first round of the auction.

Channel 4, ITV and BT Consumer that were among the front-runners to bid for the business, but are now questioning the attached value of the company.

Sources told the newspaper that the disclosed account details showed Channel 5's recent financial success is linked with Desmond's other assets, such as The Daily Express newspaper and the Health Lottery. Apparently a significant amount of money has been moved between the companies within Desmond's holding company, Northern & Shell.

The broadcaster is expected to report an operating profit of £70m for 2014.

In addition, British television executives have raised concerns about the extent to which the company has relied on Big Brother. The channel's rights to use the reality television franchise, which helped the broadcaster recently beat Channel 4 for share of viewers, expires at the end of this year.

Desmond received indicative bids of around £600m before potential buyers were allowed to check the broadcaster's accounts and a major reassessment of its value was made.

The sale is handled by Barclays, and the bank has set 14 April as deadline for binding final bids. Discovery, the factual media group part-owned by John Malone, and Viacom, the conglomerate behind MTV and controlled by Sumner Redstone, are the only companies who remains involved in the bidding.

Desmond bought Channel 5 for £104m from RTL Group in 2010. The company reported an operating profit of £26m for the first half of 2013, compared with a £16.1m loss a year earlier, following a restructuring that involved a number of cost-cutting measures and streamlining its advertising sales operation.