Entertainment One Share News (ETO)

(ShareCast News) - Peppa Pig owner Entertainment One said on Wednesday that it has rejected a takeover from broadcaster ITV that values the company at 236p per share."The board of eOne has reviewed the proposal and has unanimously rejected it on the basis that it fundamentally undervalues the company and its prospects," the Toronto-based film and TV distributor said.Press reports earlier this year had suggested that a deal with ITV might be on the cards, but Entertainment One denied it had been approached by the broadcaster.ITV said in a statement that the offer it had made represents "a significant premium" over Entertainment One's share price prior to the impact of recent bid speculation.The broadcaster said the proposal represents a premium of 19.3% over eOne's share price on 8 August, which was the last business day before the offer. It represents a premium of 41% over the weighted average share price of 167.28p in the one-month period to 11 July, which was the last day prior to speculation about ITV's interest."ITV has a clear strategy that, over recent years, has created significant value for shareholders. A key part of that strategy is continuing to build a scaled international content and global distribution business, with a focus on US scripted content."ITV believes that the proposed combination with eOne has strong strategic rationale and would further accelerate ITV's rebalancing of the business."Atif Latif, director of trading at Guardian Stockbrokers, said the offer materially undervalues Entertainment One's growth prospects."ITV or another suitor could pay up closer to £3.50 and we would not be surprised for a higher offer to materialise in the coming days. There is scope for synergies and a possibility to greater enhance production capabilities, leading to more upside for growth in earnings per share, hence why a higher all-cash deal is plausible."IG analyst Joshua Mahony said: "With the offer valuing the firm at just 236p versus the 217p price at yesterday's market close, it is clear that this will most likely represent an opening gambit rather than the final push."At 1039 BST, shares were up 6% to 230.50p.