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Friday, 31 May, 2002, 17:17 GMT 18:17 UK
Bob the Builder 'reviews' Thomas deal
Bob and friends
Bob: Waving goodbye to a deal?
Hit Entertainment - the company behind children's TV series Bob the Builder - has said it may be reconsidering a potential bid for the firm that owns Thomas the Tank Engine.

The move came after Thomas' owners - Gullane Entertainment - said its full-year profits would not meet previous expectations.

On Monday, Hit said it was considering a 500p ($7.3; 7.8 euros) share offer for Gullane, which valued the company at 154m.

But following Friday's news from Gullane, Hit said it would be reviewing its potential offer.

Deals delayed

In addition to Thomas the Tank Engine, Gullane also owns the rights to Sooty and Captain Pugwash, and owns the Guinness World Records business.

Thomas the Tank engine
Will the takeover be de-railed?
Analysts had expected the firm's profits for the 12 months to 30 June to be about 11.5m, but Gullane said it was more likely to be nearer last year's figure of 9.7m.

Gullane said its previous estimates had been based on sealing a number of deals for the company's brands.

"However, certain other agreements, most notably in respect of Guinness World Records, have been delayed and Gullane now believes that it will not be possible to conclude them in the current financial year," the company said in a statement.

It also added that sales of Guinness World Records had "fallen below estimates".

In a statement, Hit said its previously indicated bid of 500p a share for Gullane was based on the old profit estimates.

It said that in light of Gullane's announcement, "the board of Hit Entertainment is considering whether to make an offer for Gullane and, if so, at what price".

Can he fix it?

Hit originally made an offer for Gullane two years ago when it put forward a bid of 750p a share, only to see the offer rejected.

A tie-up between the two companies would create one of the biggest makers of children's television outside the US.

Hit has already used the profits earned from the international success of Bob the Builder to buy up other characters.

Last year Hit spent 190m on the rights to Barney the Dinosaur, and in October it paid 16m for Pingu the Penguin.

See also:

27 May 02 | Business
29 Oct 01 | Business
11 Sep 01 | Business
09 Feb 01 | Entertainment
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