Winchester Entertainment has asked for shares to be suspended after confirming talks on a possible merger that would count as a reverse takeover.
The talks are believed to be with New York-based ContentFilm, headed by Ed Pressman and John Schmidt, and are believed to be a sign of overseas interest in the UK due to mooted tax incentives that would involve relief on both production and distribution, where Winchester is active locally and internationally.
Shares rose 2p to 28p before trading was suspended. The merger, which would see ContentFilm make a reverse takeover of the UK company, comes only weeks after Winchester swallowed up Cobalt Media Group. Winchester founder Gary Smith was then ousted and Cobalt chiefs Alton Irby and John Muse took over the operation.
ContentFilm is expected to merge its existing UK-based sales operation under Jamie Carmichael with Winchester. Listed on AIM, Winchester has a library including Shooting Fish and Heartbreakers plus a local distribution operation headed by Mick Southworth, which recently scored a success with The Man Who Sued God. The company's slate includes a long-gestating movie based on TV series Red Dwarf, Open Range and House Of Sand And Fog.