Warner Bros parent group in talks with UK television production firm

Time Warner, the US parent group of Warner Bros Entertainment and Home Box Office (HBO), is reportedly in talks to buy UK television production company Shed Media (LON:SHDP) as it looks to add to its London-based production portfolio.

Kate Neilson
shareprices.com - Monday, June 21, 2010

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Warner Bros is in talks to buy Shed Media

Shed Media, the production firm behind popular UK series including Supernanny and Waterloo Road, confirmed that “certain members of Shed management” were in takeover talks with Time Warner subsidiary Warner Bros Entertainment. Some analysts have said they expected talks between the groups after Warner Bros appointed former Tiger Aspect MD Andrew Zein earlier in the year with the key role of growing the group’s UK production business.

The reports follow the collapse of talks between Shed and two private equity groups just two weeks ago. The buyout discussions with Bowmark Capital and Darwin Private Equity ended, leaving a perfect gateway for Warner Bros to enter talks.

The news has excited investors with the group’s share price adding 4.50p this morning, up 5.8 per cent to 82.50p per share.

Shed Media has a market capitalisation of around £70m and reports are claiming the deal could be worth £75m in current discussions.

Shed released an official statement on the talks saying: "The independent directors confirm that the company is in discussions with Warner Bros Entertainment Inc, a wholly-owned subsidiary of Time Warner, working with certain members of Shed management. There is no certainty that an offer will be made nor as to the terms on which any offer might be made."

The Media sector has been fizzing for a week after reports of a similar deal – a US group buying a British-based company – between News Corp and BSkyB (LON:BSY). British Sky Broadcasting Group confirmed it had rejected a 700p per share offer from Rupert Murdoch’s company last week, and added it was willing to hold talks if the deal was upped to 800p per share. BSkyB shares are up to 702.50p, gaining 4.50p or 0.6 per cent.

ITV (LON:ITV) shares are also gaining with early session increases. The group is set to report improved viewing figures thanks to the popularity of it's World Cup coverage.

 

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