Earlier this month, Toronto-based media conglomerate Entertainment One rejected a takeover approach from UK broadcaster ITV. The British company today says it is withdrawing its bid altogether. Its proposal valued the global film and TV indie at about £1B ($1.3B) and eOne at the time said the offer “fundamentally undervalues the company and its prospects.” ITV evidently disagrees.
In a statement, the company said today that it “continues to believe in the strategic logic and potential benefits of acquiring eOne, but has a clear view of the value of the business, recognizing that this value would need to be verified by appropriate due diligence. It appears this value is different to the level at which the Board of eOne would currently engage in a more formal process.”
ITV had been expected to up its offer, and eOne had not formally closed the door. At the time that ITV’s bid was confirmed, a spokesman for eOne said, “The ball is now in their court to come up with a better offer. In the meantime, we’re going to carry on with our business.”
Eone is believed to still be in play. Five days after the ITV approach surfaced this month, it was reported that investment firm KKR and others might bid for the group whose properties include The Mark Gordon Company and cartoon character Peppa Pig. Bloomberg said at the time that a KKR offer would beat ITV’s.
More than 80% of eOne’s sales are outside Britain making it a relatively attractive target for ITV given post-Brexit uncertainty, analysts said last month.
Last year, the company concluded a deal to join Steven Spielberg’s Amblin Partners along with Participant Media and the Reliance Group in what was essentially the latest incarnation of DreamWorks. The deal, which closed in December, allows eOne to expand its relationship in television production and distribution across additional foreign territories and handle the direct distribution of Amblin films on a multi-territory output basis.
In September, eOne acquired a 70% stake in Peppa Pig producer Astley Baker Davies worth $212M, while the company also acquired a majority share in the prolific Mark Gordon Company at the start of last year.
A move to acquire eOne was seen as being in line with ITV’s strategy of increasing its ownership of content in order to reduce its reliance on advertising revenue. EOne’s rights library is exploited across all media formats and includes more than 100,000 hours of film and TV content and approximately 40,000 music tracks.