€3bn bidding war erupts for Endemol

Apax Partners and TH Lee are reportedly going head to head with both Goldman Sachs Capital Partners and PAI as well as broadcasters Televisa and CBS in a hotly contested auction for Telefonica’s Endemol.

Telecoms group Telefonica is expecting final round offers today for its 75 percent stake in the producer of television’s Big Brother franchise Endemol.

Several private equity firms are expected to compete for the €3 billion media company. The bid speculation has seen the partially-listed media group’s share price go up from €16 six months ago to €24.65 today.

The buyout arm of US investment bank Goldman Sachs is partnered with Endemol’s co-founder John de Mol.

The UK Newspaper Financial Times said De Mol’s involvement in the bid has led several Endemol executives to threaten to leave the company if Goldman triumphs.
  
French private equity group PAI is expected to make a bid with Bernard Arnault, the LVMH chairman and chief executive. PAI is expected to partner with De Agostini of Italy and the former head of Endemol France Stephan Courbit.
 
US media specialist T H Lee is also thought to be a bidder in partnership with Apax Partners, as well as former Endemol executive Tom Barnicoat, Italian media group De Agostini and US media mogul Haim Saban.
 
Televisa, Mexico’s largest broadcaster and CBS, the US broadcaster are also believed to be interested in the media company which shot to fame on the back of its notorious Big Brother franchise. Endemol also produces UK TV programme Deal, or No Deal, which is fronted by British television celebrity Noel Edmonds.

Spanish telecoms group Telefonica began the bidding auction in February. The FT reports sources close to the deal as saying Endemol’s high share price will mean most bids give little or no premium.

The involvement of several high profile members past and present of Endemol’s management, has led to allegations of conflicts of interest similarly to Stefano Pessina’s involvement in US buyout group Kohlberg Kravis Roberts’ acquisition of UK pharmacist Boots last month.
 
Telefonica paid €5.5 billion for Endemol when the last mergers and acquisitions frenzy gripped the markets in 2000.
  
Endemol’s shares were trading up 2 percent at €24.65 at 1515 CET.