Bidder on prowl for Postman Pat and Rupert
Entertainment Rights, owner of children's TV favourites Postman Pat and Rupert the Bear, today confounded speculation that it might be looking for an urgent cash injection by announcing it is "in early-stage discussions" about a takeover.
The company has been suffering from knock-on effects of the collapse of Woolworths, its main customer, which accounted for 20% of sales.
Potential bidders are believed to include Apax-owned Hit Entertainment, Saban Capital and Canada's Cookie Jar Entertainment. Hedge fund Och-Ziff and leisure mogul Trevor Hemmings, who were involved in takeover talks with Entertainment Rights earlier this year, may also be interested. Hemmings is the biggest shareholder.
Entertainment Rights' stock market value has dived from £267 million in March 2007 to £3 million. Earlier this month, the group, with debts of £125 million, appointed a new chief executive and announced cost-cutting plans, including shedding a third of its 150-strong workforce.
Its bank, HBOS, then extended a £130 million overdraft by £13 million until February. At the time, the group described it as a move to stave off "potential cashflow shortfalls", but today a spokesman said: "The company's priority is about securing longer-term funding."
