You could be correct with diverter valve, however, to get it right, use a multimeter and test the following.
In the junction box (where the diverter valve is wired)
is there 240v to the WHITE wire when heating is called for?
If no: Clock and/or roomstat are at fault.
If yes: Diverter is at fault, it could just be the synchron motor not turning.
With the heating calling (hot water off), move the lever on the side of the valve as fast as you can to MAN (manual) position, if the pump suddenly kicks into life briefly and then stops, it's most likely the synchron motor only (loads cheaper than a whole new diverter).
Carefree, July 2010