ITV Is Said to Pursue `Peppa Pig' Owner Entertainment Oneby , , and
London-based broadcaster in talks to buy Canadian TV producer
Entertainment One shares soar most in over four years
ITV Plc is pursuing a takeover of Entertainment One Ltd., the $1.1 billion Canadian company that owns the rights to popular preschool cartoon character “Peppa Pig,” according to people with knowledge of the situation.
Broadcaster ITV, whose shows include “Mr. Selfridge” and long-running soap opera “Coronation Street,” has held talks with Entertainment One about a possible deal, the people said, asking not to be identified as the discussions are private. Entertainment One rose the most in more than four years. The Toronto-based company said Thursday it hadn’t received an approach. Representatives for ITV declined to comment.
“Peppa Pig” would bring to ITV a TV franchise with more than $1 billion in worldwide retail sales in 2015, and further the London-based broadcaster’s expansion into production as it reduces its reliance on network advertising. A more than 50 percent slump in Entertainment One’s shares in recent months makes the target a bargain relative to its past market value.
“For ITV it’s all about the content and so a deal for Entertainment One makes sense, and the shares have slumped so it’s opportunistic,” said Ian Whittaker, a media analyst at Liberum in London.
Entertainment One distributes TV and films in Canada, Australia, the U.K. and U.S. and several European countries and has worked with titles including this year’s Academy-award winner “Spotlight,” “Fear the Walking Dead” and “The Hateful Eight.”
ITV would probably sell the movie-distribution business to focus solely on TV, said Alex DeGroote, an analyst at Peel Hunt in London.
“I can’t see ITV wanting the film business when the TV content is the most valuable, especially Peppa,” he said.
No final decisions between ITV and Entertainment One have been made, and discussions may not result in a transaction, people with knowledge of the matter said.
The shares of Entertainment One soared 17 percent to 185.1 pence as of 11:11 a.m. in London, valuing the company at 791 million pounds ($1.1 billion). ITV rose 1 percent to 242.6 pence for a market value of 9.8 billion pounds.
ITV, which broadcast hit show “Downton Abbey,” a year ago bought Talpa Media Holding BV, the maker of “The Voice” reality singing show, and Mammoth Screen Ltd., which produces the drama “Poldark.”