EOne rebuff for unfriendly giant ITV's £1 billion offer

The battle for Peppa Pig kicked off today as the pink porcine’s owner Entertainment One dismissed a £1 billion takeover bid from ITV as far too low.

Entertainment One, which has been a rumoured target for the Downton Abbey broadcaster since spring, saw its shares race up 15.5p, or 7%, to 233.1p, just short of the 236p offer which ITV tabled by letter last night.

In a brief stock market announcement, Entertainment One said its board “has reviewed the proposal and has unanimously rejected it on the basis that it fundamentally undervalues the company and its prospects”.

That means the firm, which is domiciled in Toronto, listed in London and has operations around the globe, has the backing of its largest shareholder, the Canadian Pension Plan Investment Board.

It has a 19.9% stake, most of which was acquired at a price of 269p a share just under a year ago.

At the time Scott Lawrence, managing director of the fund manager, said: “We are pleased to have the opportunity to become a significant shareholder in eOne and to work with the company to help it achieve its ambitious growth plans of doubling in size within the next five years.”

Lawrence is on the board and so agreed the rejection of the ITV bid. Despite being best known for Peppa Pig, Entertainment One has a huge 100,000 hours of film and TV programmes and owns 51% of US TV production company Mark Gordon which made Grey’s Anatomy.

It also has a tie-in with Amblin Partners, which distributes Steven Spielberg and DreamWorks films including the current hit BFG.

ITV, under chief executive Adam Crozier, has been rapidly acquiring production companies with The Voice maker Talpa Media bought for £355 million and Poldark maker Mammoth Screen acquired for some £10 million last year.

Entertainment One last valued its content library, which includes 40,000 music tracks, in March 2015 at “more than $1 billion”.

Since then it is certain to have risen in value, while the takeover premiums paid for children’s programmes like Peppa and its new series airing on Disney, PJ Masks, have also shot up.