Liberty and Others Bid for Endemol

Liberty Global and other bidders will compete to acquire Black Mirror-creator Endemol

FSMNews

Liberty Global and several other bidders are now preparing offers for TV production company Endemol Shine, which is the creator of the classic reality show “Big Brother” and dystopian TV drama “Black Mirror,” before a preliminary drama next week.

Among the bidder eyeing the Netherlands-based Endemol are ITV, RTL Group’s Fremantle Media and Lions Gate Entertainment, according to sources familiar with the matter. The planned deal comes in the heat of the rise of streaming giants such as Netflix and Amazon Prime, which has caused turbulence in the industry.

The sellers target a price tag between 2.5 and 3 billion euros, or between $2.9 and $3.5 billion, according to one banker with direct knowledge of the process. However, this may prove ambitious with bids expected to come with the range of 2 to 2.5 billion euros.

That would put it at roughly 10 times core earnings before interest, taxation, depreciation, and amortization, or EBITDA. According to another banker, this could be the best that the seller could expect to get.

Meanwhile, another source close to one potential buyer said that Endemol’s catalogue was filled with ageing formats that make potentially less attractive than purchasing small production outfits and working directly with top creative talents.

According to this person, Endemol also sported sizable debts. It has also gone through a round of cost cutting, suggesting that the potential for synergies with an acquirer might be limited.

“We’re interested, yes, but skeptical. Is Endemol really a creative company anymore? It’s financially weak,” said that person.

Endemol declined to give any comments.

FSMNews

Endemol’s sale comes as traditional TV players need higher quality scripted serials that can fill their fledgling video-on-demand services. Binge-watching online viewers will also less likely be satisfied with their staple fare of reality and lifestyle shows.

It also paves the way for Liberty, which is the US telecommunication and pay-TV company that’s built by John Malone, to use its distribution expertise and assets.

Liberty may possibly bid for Endemol via All3Media, which is the production joint venture it owns together with Discovery Inc, said CEO Mike Fries at a recent industry gathering.

“It would be surprising if we didn’t look at it through All4Medi,” said Fries, adding that Liberty would continue to “get its feet wet” through content deals.

Meanwhile, Discovery has struck a deal with Germany’s ProSienbenSat 1 Media to build a German streaming TV platform. It has also invited others to join.

France-based Banijay Group may also enter the competition for Endemol, as per the sources. Vivendo owns minority stake in Banijay.

Apollo Global and Fox have hired Deutsche Bank and Liontree to serve as advisers to the deal.

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