Entertainment One buys Canadian film distributor
Entertainment One is hitting the acquisition trail to snap up Alliance Films, an independent distributor of filmed entertainment products in Canada, the UK and Spain.
Entertainment One is hitting the acquisition trail to snap up Alliance Films, an independent distributor of filmed entertainment products in Canada, the UK and Spain.
The "Peppa Pig" firm is paying in the region of C$225m for the Canadian distributor, including the take-on of almost C$50m in debt. The sellers are Investissement Qubec and affiliates of US investment bank Goldman Sachs.
A contingent payment of up to C$35m may become payable to the sellers after completion depending on how well Alliance's films do at the box office. An additional amount of C$12m may also become payable to the sellers after completion in the event that certain tax provisions are settled for less than the amount provided in Alliance's accounts.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The combination of Entertainment One and Alliance will establish the Entertainment One as the largest independent film distributor in each of the Canadian and UK markets, the company claimed.
Alliance's film library includes well-known and commercially successful films produced by independent film studios, including Pulp Fiction, Good Will Hunting, Lord of the Rings, The King's Speech and The Hunger Games. The enlarged group will benefit from a combined library of more than 35,000 film and television titles.
The Entertainment One directors believe that the acquisition will deliver estimated annualised pre-tax cost synergies of at least C$20m by the third anniversary of completion of the deal.
Entertainment One intends to partially fund the acquisition through a share placing which is expected to raise around £96.5m, net.
The company is placing 73.3m shares at 150p per share, a discount of 3.54% to the share price on the day before the acquisition was announced. The placing is not conditional on the acquisition going through; the deal has to receive approval from the Canadian Competition Bureau.
"As a result of the acquisition, Entertainment One will be a more competitive business in each of the geographic markets that we serve, allowing us to act as a more valuable partner for content producers and expanding the quality and depth of the content that we offer to our customers," enthused Darren Throop, the Group Chief Executive Officer of Entertainment One.
Shares in Entertainment One rose 13p to 168.5p in the morning session on the day on which the acquisition was announced.
JH
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.
-
Reeves warned against property tax shake-up – 3 ways it could backfire on first-time buyers
Rachel Reeves reportedly has her eye on high-end property taxes in the upcoming Budget, but there are concerns a shake-up could unintentionally hamper those trying to get on the housing ladder
-
Average Brits want to retire five years before they can – who has the widest retirement gap?
Brits are expecting to work for longer than ever but there are big disparities in the number of extra working years predicted. A small tweak could help close the gap