Entertainment One (ETO) has doubled down on its thriving TV business by buying a majority stake in Grey's Anatomy producer The Mark Gordon Company (MGC). The deal marks the international media distributor's first direct step into the enormous US market, and complements its strategy of investing in higher-value production.
It has agreed to pay $133m (£87m), or 4.4 times MGC's adjusted cash profit of $30m in 2013. That will be funded through a $175m extension to its banking facilities, which could send net debt up to around 2.5 times cash profits. Still, analysts think the joint venture could boost next year's EPS by between 2 and 2.5 per cent.
Broker N+1 Singer forecasts full-year pre-tax profit of £84.8m, giving EPS of 22.3p.
