ITV’s takeover offer for EOne not nearly pig enough for investors
ITV is likely to have to raise its bid for Entertainment One (EOne) by at least 20 per cent if it is to tempt the owner of Peppa Pig, reports suggest.
The broadcaster had a 236p-per-share – equal to around £1bn – offer turned down by EOne, a Canadian company listed in London, earlier this month.
It has since emerged that private equity house KKR may also be interested in the company, which is behind films such as The BFG and Spotlight.
Read more: Investors Peppa Pig out on EOne shares as more takeover interest emerges
A top 10 EOne investor has told the Sunday Telegraph that City institutions would not accept a bid below the 330p-per-share price they paid in a placing last summer. This would equal 284p, adjusting for a September 2015 rights issue.
The fund manager told the paper: “[T]hey need to start talking fair value. They are a long way away from that at the moment.”
Media analysts have also suggested EOne will be seeking a far higher offer. Ian Whittaker, of Liberum, told Morning Wire the board would be hoping for a bid of more than 350p, while Peel Hunt’s Alex De Groote said something above 280p may tempt the target company.
Read more: Competition emerges for ITV in pursuit of Peppa Pig owner EOne
Eone’s share price has risen from below 200p to above 250p this month, amid the takeover interest.
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ITV and EOne declined to comment.