Discovery linked to All3 bid

The race to acquire European production and distribution outfit All3Media is heating up, with US factual giant Discovery Communications reportedly now in the running.

Discovery has approached All3’s private equity owner, Permira, with a view to making a bid after an exclusivity period of discussions with FremantleMedia ended, according to Sky News.

C21 revealed in January the talks between RTL Group’s Fremantle and All3, with a price tag on the deal thought to be north of £500m (US$830m).

Fremantle remains a frontrunner but is involved in a lengthy due diligence process over the deal, sources said.

Permira attempted to sell All3 for £750m in 2011 but difficult market conditions were blamed for the failure to attract a bid that matched the value placed on the company by investment bank UBS.

A bid from Discovery would fit with its aggressive international expansion strategy, which saw it recently add UK indie Raw TV to previously acquired production house Betty.

In December 2012, Discovery paid US$1.7bn for 12 SBS channels in the Nordic region that belonged to Germany’s ProSiebenSat.1 and €170m (US$222m) for a stake in channels belonging to France’s TF1, including Eurosport.

It has since taken an early option to increase its share in Eurosport to a controlling stake.

Discovery was also rated as the favourite to acquire UK terrestrial Channel 5 from Richard Desmond’s Northern & Shell, but C21 understands that the US firm baulked at Desmond’s £600m asking price for the channel he bought for just £104m four years ago and, having had a final offer of £350m rejected, has now stepped away from negotiations.

All3Media, run by Farah Ramzan Golant, counts Company Pictures, Maverick TV, Objective Productions, Lion Television, Optomen and Studio Lambert, as well as distribution arm All3Media International, among its assets.

Neither Discovery nor All3 would comment on what they described as speculation.