Hasbro has struck a deal for the acquisition of Entertainment One, the company that owns the Peppa Pig cartoon franchise, for $4 billion.
The BBC had the news:
US toy maker Hasbro will acquire Peppa Pig owner Entertainment One for around £3.3bn ($4bn), the firms said in a statement.
Hasbro said the deal would expand its entertainment and “family-oriented storytelling” portfolio.
UK-listed Entertainment One owns other preschool titles including PJ Masks.
The deal is the latest in a string of foreign acquisitions of UK-listed firms including the £4.6bn buyout of pub chain Greene King.
Under the all-cash transaction, Entertainment One shareholders will receive £5.60 for each common share.
“Hasbro will leverage Entertainment One immersive entertainment capabilities to bring our portfolio of brands that have appeal to gamers, fans and families to all screens globally,” the firms said in a statement.
The American toy giant is behind a diverse range of titles including the My Little Pony and Transformers franchises, as well as the Monopoly board game and Play-Doh.
Tanishaa Nadkar and Noor Zainab Hussain reported for Reuters that Entertainment One shares had spiked on the news:
Peppa Pig-owner Entertainment One’s (ETO.L) shares rose more than 30% to a record high on Friday, surpassing the price agreed by the company’s board with U.S. toy maker Hasbro Inc (HAS.O) in a sign that investors see some chance of a counter offer.
The boards of the two companies said on Thursday that they had agreed a price of roughly $4 billion (3.27 billion pounds) in cash for the deal, which gives Hasbro access to Entertainment One’s lucrative shows aimed at infants and preschoolers.
Under the deal, Entertainment One’s shareholders will receive 560 pence per share, representing a premium of 26.4% to Thursday’s close. Entertainment One’s shares rose to as much as 579 pence on Friday.
“Given the nature of the current content cycle where there are a number of emerging large new entrants and platforms alongside several large incumbents, we would not rule out a competing bid for eOne,” RBC analysts, who raised their price target for Entertainment One, said.
The Financial Times’ Eric Platt and James Fontanella-Khan noted:
Several high-profile British companies have been targeted by overseas acquirers since the Brexit vote three years ago, but there has been a new round of acquisitions since Boris Johnson’s arrival at 10 Downing Street sent sterling to its lowest level against the dollar in years.
The takeover of Entertainment One ranks among the largest purchases of a British-listed group this year. It comes on the heels of the £4.6bn purchase of the UK’s biggest listed pubs and brewery group Greene King by the investment firm founded by Li Ka-shing, the £4bn buyout of the UK aerospace and defence supplier Cobham by a US private equity group, and the roughly £5bn takeover of the food delivery company Just Eat by Netherlands-based Takeaway.com.
The purchase will add a slate of new brands to Hasbro’s portfolio as the toy maker known for the Monopoly board game and Play-Doh moulding clay seeks to bolster its pre-school business and expand its entertainment offerings.
Among Entertainment One’s most prized assets is Peppa Pig, the children’s cartoon that turned 15 this year. The group said the cartoon generated £90.2m of revenue in the year to March 31, up 20 per cent from a year earlier as Peppa continued to gain traction outside the UK.