Peppa Pig Owner Spurns £1bn ITV Takeover

Peppa Pig owner Entertainment One (Other OTC: ENTMF - news) has rejected a £1bn takeover offer from ITV (Frankfurt: A0BLQP - news) .

The UK-listed Canadian company said its board had unanimously decided to turn down a proposal valuing it at 236p a share which it said "fundamentally undervalues the company and its prospects".

It had a market value of about £930m at the start of trading on Wednesday. The offer would take this to £1.03bn. Shares (Berlin: DI6.BE - news) rose 7% after the disclosure about the takeover offer.

The statement from Entertainment One, in response to reports which had sent its shares 10% higher on Tuesday, confirmed that it had received a "preliminary proposal".

ITV later confirmed that it was behind the offer and pointed out that it was at a "significant premium" to the share price prior to the bid speculation.

It added: "ITV believes that the proposed combination with eOne has strong strategic rationale and would further accelerate ITV's rebalancing of the business."

But it remained tight-lipped on plans for any higher offer, saying only that it "reserves the right to withdraw, vary or amend the proposal".

Entertainment One owns the rights to TV shows including global children's hit Peppa Pig, as well as more than 40,000 film and television titles including Oscar-winning hit Spotlight.

Its Amblin Partners venture with Stephen Spielberg is behind this summer's film, The BFG, based on Roald Dahl's classic children's book.

Entertainment One also owns around 40,000 music tracks.

A takeover deal would help ITV broaden its business, continuing its strategy of acquiring companies making TV content as it seeks to offset pressure on its traditional advertising revenue income.

ITV said last month that it would slash £25m in costs as it warned ad revenue was set to dip 1% in the nine months to the end of September amid the fall-out from the UK vote to quit the EU.