Peppa Pig owner rejects £1bn ITV takeover approach

The owner of popular children's TV character Peppa Pig has rebuffed a takeover approach from broadcasting giant ITV worth more than £1 billion.

Peppa Pig and friends caught the eye of ITV. Picture: Contributed
Peppa Pig and friends caught the eye of ITV. Picture: Contributed

Entertainment One (eOne) said it “unanimously rejected” a 236p-a-share proposal as it believes it “fundamentally undervalues” the group.

The Canada-based group owns the rights to TV shows including Peppa Pig – the cartoon character who has turned into a global children’s phenomenon.

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It also owns more than 40,000 film and television titles, including last year’s Oscar-winning hit Spotlight, and its Amblin Partners venture with Steven Spielberg is behind this summer’s movie The BFG, based on Roald Dahl’s classic children’s book. Entertainment One also owns around 40,000 music tracks.

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In response to its rebuffed approach, ITV said its proposal had represented a “significant premium” over eOne’s share price, “prior to the impact of recent bid speculation”.

It added: “ITV has a clear strategy that, over recent years, has created significant value for shareholders. A key part of that strategy is continuing to build a scaled international content and global distribution business, with a focus on US scripted content. ITV believes that the proposed combination with eOne has strong strategic rationale and would further accelerate ITV’s rebalancing of the business.”

A deal between the two would help ITV broaden its business and boost its content offering as it seeks to reduce reliance on advertising revenue, which is expected to come under pressure after the Brexit vote.

ITV last month said it would slash £25 million in costs as it warned advertising revenue is set to dip 1 per cent in the nine months to the end of September amid the fallout from the decision to quit the EU.

ITV was rumoured to have had its sights on Entertainment One earlier this year, but the group denied being approached. ITV has acquired a number of production companies in recent years, including Talpa Media Holdings, which makes talent show The Voice, and Mammoth Screen, which produces Poldark.

It recently appointed Sir Peter Bazalgette – the man credited with bringing Big Brother to UK screens – as chairman, taking over from Archie Norman in May.

Analysts at Liberum said: “There is definitely a rationale for ITV to acquire eOne and it would fit in with its stated policy of boosting the revenues from non-TV advertising sources.

“The question now is whether ITV comes back with a higher bid – it can afford to so the question is whether it has the desire to come back with a substantially higher bid.”