7th May 2014 07:14
LONDON (Alliance News) - ITV PLC said Wednesday it has agreed to acquire a controlling stake in Leftfield Entertainment Group in a USD360 million cash deal.
ITV has acquired 80% of Leftfield, US independent producer of reality programmes, from its founder and Chief Executive, Brent Montgomery.
The acquisition, which has already gained regulatory approval, makes ITV Studios US Group the largest unscripted independent producer in the US, said ITV, and will be earnings enhancing from "day one."
ITV will make a USD360 million cash payment for 80% of the company, with further potential payments dependent upon Leftfield's continued delivery of significant profit growth.
There are put and call options in place to buy the remaining 20% of Leftfield, under which a call can be exercised three years after the initial deal and a put and call at the end of year five. The total maximum consideration for 100% of Leftfield is USD800 million, including the initial payment, said ITV. This would only be paid if Leftfield delivers average earnings before interest, taxation, depreciation and amortisation of at least USD130 million per annum between years three and five.
Leftfield delivered USD38 million of earnings before interest, taxation, depreciation and amortisation on a proforma basis in 2013. The firm also owns Sirens Media and has established two joint ventures - Loud Television and Outpost Entertainment.
ITV said the acquisition, "represents considerable progress in ITV's strategy of building a strong international content business, particularly in the US. It gives ITV Studios a significant presence on both the east and west coasts and strengthens and complements our existing creative capability."
Shares in ITV jumped at the open Wednesday morning, the stock leads the FTSE 100, up 2.21% at 190.00 pence per share.
By Alice Attwood; [email protected]; @AliceAtAlliance
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
ITV