LONDON — U.K. broadcasting and production giant ITV is mulling a bid for Canadian production and distribution company Entertainment One. ITV has held preliminary talks with eOne about a deal, according to sources cited by Bloomberg, but no decision has been reached on the move.
Responding to the speculation, Entertainment One, also known as eOne, said Thursday “no approach has been received” by the company. A spokesman for ITV said: “We do not comment on speculation.” Shares in Entertainment One on the London Stock Exchange, where it is listed, rose 16% at midday local time Thursday to 184.10p, valuing the company at £777 million ($1.1 billion). Shares in ITV rose 1.33% to 243.40p.
Entertainment One has been on the acquisition trail in recent years, buying majority stakes in the Mark Gordon Company, the producer of “Grey’s Anatomy,” and Astley Baker Davies, creator of “Peppa Pig.” This has forced it to take on further debt, which has dented its stock price. In the past year its share price has fallen by around 50%.
ITV has been bulking up too, as part of a “transformation plan” put in place in 2010. The plan’s strategic priorities are to maximize audience and revenue share from its free-to-air broadcast and VOD business; to grow its international content business; and to build a global pay and distribution business. Since the plan was put in place, ITV has been investing heavily in production companies as it attempts to reduce its reliance on advertising revenue from its free-to-air channels in the U.K.
In late 2012 and early 2013, ITV purchased controlling stakes in U.S. companies Gurney Prods. and High Noon Entertainment, and acquired 100% of the U.K.’s The Garden and Big Talk Prods. Later in 2013, ITV took a controlling stake in Thinkfactory Media, the U.S. producer of reality, entertainment and drama shows, including the Emmy award-winning “Hatfields & McCoys.”
In early 2014, ITV bought a controlling stake in DiGa Vision, the U.S. producer of reality and scripted programming, including “Teen Wolf.” Later that year, ITV acquired Leftfield Entertainment Group, whose shows include “Pawn Stars,” “Counting Cars,” “American Restoration” and “Real Housewives of New Jersey.” The deal made ITV the largest unscripted independent producer in the U.S.
Last year, ITV bought John de Mol’s entertainment show producer Talpa Media, which is the creator of singing competition format “The Voice.”