Entertainment One buys control of Los Angeles reality TV maker

Entertainment One has spent $23m on acquiring a majority stake in Los Angeles reality television production company Renegade Entertainment, maker of such gems as 'Naked & Afraid' and 'Fit to Fat'.

The FTSE 250 group said it expected the transaction will be earnings enhancing in its first year.

Entertainment One has acquired a 65% controlling stake from the company's founders, David Garfinkle and Jay Renfroe, who have agreed new long-term contracts to continue in run the business.

Put and call options have also been agreed to enable eOne to acquire the remaining 35% stake after five years.

The fee paid is subject to an adjusting payment based upon the adjusted EBITDA performance of Renegade, known as Renegade 83, to 31 December 2016.

Last calendar year, Renegade 83 reported unaudited revenue of $35.1m and unaudited net income before tax of $2.9m, while adjusted EBITDA amounted to US$5.2m.

"Under David's and Jay's leadership, Renegade has rapidly developed a reputation for creating exceptional programming, with strong domestic and international audience appeal," said eOne chief executive Darren Throop.

"The acquisition complements our expanding unscripted slate, and we are excited to see the business continue its development as part of the eOne Group."

Shares in the company, which have in recent weeks bounced back from February's three-year lows, were down 1.7% to 151.4p by 0930 GMT on Thursday.