Rank Organisation boss Michael Gifford broke his usual “no comment” policy yesterday to state “clearly and unequivocally that our film and television activities are not for sale.”
Gifford’s statement was in response to press reports in Variety and elsewhere that a group called Premier Media is planning to bid for Rank’s film and TV division.
Noting that it is Rank’s normal practice “not to comment on such rumors,” Gifford said that “on this occasion it is in shareholders’ interests” to make the company’s position clear.
Rank is Britain’s largest leisure and entertainment conglom, with interests ranging from hotels and bingo halls to the Odeon cinema circuit, Pinewood Studios, Deluxe Labs and Rank Film Distributors.
But Chemical Bank, which is advising the Premier Media consortium, yesterday responded to Gifford’s statement by issuing a release that also cites the interests of the Rank shareholders.
Noting that “Premier Media has been and is fully aware that Rank have not put their film and TV division up for sale,” Chemical says that “if a realistic offer is made, the board of Rank would have to consider the proposal seriously.”
Rank is due to unveil full-year results tomorrow, and it seems certain that, whether he likes it or not, much of Gifford’s time with analysts and financial journalists will be spent discussing the national price tag for the film and TV business.
The division made profits of $ 33 million last year and analysts expect an improvement this year to something nearer $ 43 million, largely as a result of bigger volumes in the video duplication business. Expressed as a multiple of earnings and adding the substantial premium that Gifford would require before he takes down his “Not-For-Sale” sign, the offer price would likely be in excess of $ 600 million. It does not seem that Premier has yet secured firm commitments for that level offunding.
Premier honchos Ileen Maisel and Graham Bradstreet have opted to keep a low profile until they have all the money and can formally approach Rank with an offer.
Together with Chemical’s Robert Kretowicz, Maisel and Bradstreet have been working on the bid for the last six months. They have secured the services of former Independent Broadcasting Authority boss John Whitney as chairman and Channel Four chief exec Michael Grade as non-executive director.