February 13, 2012 / 10:09 AM / 6 years ago

UPDATE 2-Peppa Pig owner Entertainment One drops sale process

* Entertainment One drops sales process

* Company says did not receive attractive offers

* To now focus on making acquisitions

* Stock down 20 percent (Adds background, analyst comment, stock movement)

Feb 13 (Reuters) - Entertainment One Ltd, known for its children’s TV series Peppa Pig, said it is no longer considering a sale of the company, as it has not received any attractive buyout offers, and will focus instead on acquisitions.

Shares of the company, which produces and distributes film and television content, lost a fifth of their value on Monday despite forecasting strong full-year results.

“The board has considered various proposals that have been made for all or parts of the group and has concluded that these do not adequately reflect the company’s value,” Entertainment One said in a statement.

Entertainment One said its financial advisors Credit Suisse and JP Morgan are evaluating a number of acquisition opportunities for the company.

A company spokeswoman declined to provide further details.

Singer Capital Markets analyst Johnathan Barrett said the financing and macro environments would have materially affected value calculations on the part of bidders.

The company had been betting on the huge popularity of its Peppa Pig character to attract potential buyers. In September, Entertainment One said it had received a string of takeover approaches.

The pig’s cult status has put it on par with Thomas the Tank Engine, and it was even courted by Britain’s Labour Party to appear as a mascot prior to the 2010 general election.

Peppa Pig is the number one pre-school UK toy and is gaining traction around the world. Entertainment One, which opened the Peppa Pig World theme park in Hampshire in April 2011, is also planning on launching toys range in the United States in time for the 2012 Christmas season.


Peel Hunt analyst Patrick Yau said he was surprised by the halt in the sale process as the company has built strong momentum in its businesses.

“We remain positive on the underlying fundamentals of the business and would see this as a buying opportunity for longer term investors to come on board,” Yau wrote in a note.

Entertainment One’s stock fell 20 percent to 160 pence — paring most of its gains since September, when the company announced that it had received takeover approaches.

The company, which is the UK distributor of the Twilight movies, also said on Monday it expects to report full year results in line with market expectations and that EBITDA margins improved.

Entertainment One’s rights library includes over 20,000 film and television titles, 2,500 hours of television programming and 45,000 music tracks. (Reporting by A. Ananthalakshmi in Bangalore; Editing by Anthony Kurian)

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