Pork Chops

Peppa Pig’s corporate owner is as popular as the cartoon itself. Private equity group KKR may be weighing a bid for the animated sow’s parent Entertainment One, according to a Bloomberg report – following a recently spurned 1 billion pound offer from Britain’s ITV. If Peppa’s proprietor wants to face down its latest suitor, it has options. Entertainment One should be a big winner in the shift to digital in TV and film, but its valuation lags peers. U.S. media companies trade at an average forward-earnings multiple of 28, double that of Peppa’s owner. Part of the problem may be lower media valuations for London-based firms: hence redomiciling across the Atlantic might help. But so could splitting the business up. Entertainment One’s film business looks ripe for a spin-off. Sales are slowing as its core markets mature and a run of blockbusters like Star Wars undercut box office returns for independent films. The division may fetch 850 million pounds based on fellow indie-filmmaker Lions Gate’s 14.7 times forecast earnings before interest, tax, depreciation and amortisation multiple.

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