HIT reduces offer for Gullane by 14%

HIT Entertainment, the company behind Bob the Builder, yesterday tried to fix a new deal to buy its rival Gullane, but only after it had reduced the price it was offering.

HIT, which offered 500p a share for Gullane last month, has came back in recent days with a reduced bid of 430p, valuing the business at £135m.

The group cut its offer price by 14 per cent after Gullane warned that problems with its Guinness Book of Records business in the US and delayed TV deals would mean flat profits this year. But Gullane yesterday rejected the new offer for its stable of children's favourites, which include Thomas the Tank Engine and Sooty, saying it was too low.

Despite the problems, Gullane believes it can drive a hard bargain as a number of players in the world of children's entertainment are keen to snap up Thomas the Tank engine, which generates substantial profits and is popular in other countries including America and Japan.

As well as HIT, Disney and Carlton are also circling Gullane, but neither has made an offer.

Gullane confirmed the renewed offer from HIT, saying: "We have received an approach, which significantly reduces the proposed price. The board believes this approach materially undervalues Gullane."

The company added that the problems which emerged in its profits warning did not affect the underlying strength of the business and said it was "actively exploring all options". Its shares jumped 2 per cent to 412.5p.

HIT, headed by Rob Lawes, would not comment on whether it will raise its offer again, but it is keen to reach agreement with Gullane's management before making a formal offer. Gullane now expects pre-tax profits for the year to June to be broadly in line with last year's £9.2m compared with analysts' expectations of £11.5m.

This is not the first time that HIT has made overtures to its rival. Two years ago the companies were in talks which would have valued Gullane at 750p a share, but the negotiations foundered.

Gullane, which was then known as the Britt Allcroft Company, is thought to have wanted more of a cash element to the offer.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
The Ridiculous Six has been produced by Adam Sandler, who also stars in it
filmNew controversy after nine Native American actors walked off set
Life and Style
The original ZX Spectrum was simple to plug into your TV and get playing on
techThe ZX Spectrum is going back on sale - with all your favourite retro games
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk