The BBC has denied reports that it was unaware that its new Director-General Greg Dyke had a £6m shareholding in the corporation's rival, Granada.

Following a report in the Sunday Times about the shareholding, the BBC issued a statement saying that Mr Dyke had been given until April to sell the shares.

A spokesman for the corporation said Mr Dyke had revealed his share interests as far back as June 1999 in a letter.

He said the board of governors had agreed with Mr Dyke at the time of his appointment that he should complete the disposal of his shareholding by April 2000.

It was customary for some time to be given for the disposal, he said.

Mr Dyke was also told to get rid of an interest in media group Pearson, which he has since done, the spokesman added.

Code of ethics

Under the BBC code of ethics, executive committee members are required to declare and, if appropriate, relinquish shareholdings in companies that might represent a conflict of interest.

Earlier, a spokeswoman said the shareholding had always been declared in the register of interests and the implication that the BBC governors were unaware of it was incorrect.

"There was never any question that they didn't know about it, it was registered from the start," she said.

The BBC drew up its register of interests three years ago for its executive committee members after controversy over how it had been paying Mr Dyke's predecessor, Sir John Birt.

Holding 'beats Granada chairman'

The Sunday Times said the holding was larger than those held by Granada's chairman or its chief executive.

Mr Dyke has owned the shares since 1994 when he was chief executive of LWT before it was taken over by Granada.

He left with a 1.2 million share stake, then worth about £9m.

He sold some of the shares but kept 479,000, which then doubled to 958,000 in July last year after a two-for-one share issue.

BBC chairman Sir Christopher Bland also once owned about £14m-worth of Granada shares. He sold them before joining the corporation.

Sir Christopher was chairman of LWT while Mr Dyke was its chief executive.

Under attack

Both the BBC and Mr Dyke were criticised by senior Tories who described the situation as "ridiculous and totally unacceptable".

Shadow culture, media and sports secretary Peter Ainsworth said Mr Dyke should be forced to sell the shares immediately.

"I think it's an outrage...he should realise that by accepting the job at the BBC he has entered the public arena and a corporation for which we all pay.

"It is very surprising that the governors have not required him to sell these shares forthwith.