LONDON (Brand Republic) - HIT Entertainment, the UK company behind children’s favourite Bob the Builder, is to buy US rival Lyrick Studios in a cash and stock deal valued at $275m (£190m).
The acquisition ends recent speculation about the entertainment company’s plans for expansion. The deal, which won clearance yesterday from anti-trust regulators, will double HIT’s turnover and increase its value to around £600m. It includes the purchase of Lyrick subsidiaries Big Feats and the Lyons Partnership.
Bob the Builder, created in April 1999, currently accounts for around 60% of HIT’s £20.3m annual sales revenues. HIT has been advised by analysts that it should reduce its reliance on Bob and capitalise on its high share price before the Bob the Builder trend dies down.
Lyrick’s most famous brand is Barney the Dinosaur, another pre-school children’s character first launched in 1988. It has since become one of the US’s best-selling children’s characters.
The deal will increase HIT’s exposure in the US children’s TV market -- the biggest in the world for children’s rights. HIT recently signed a deal with Viacom which will put Bob the Builder on US TV screens for the first time.
HIT’s share price was trading at 440p before trading in the stock was suspended last week ahead of the deal.