Winchester Entertainment's stock rose a hefty 44% yesterday after Simon Franks and Zygi Kamasa's UK distributor Helkon SK bought 3.67% of the media company.
Winchester chief executive and founder Gary Smith played down speculation that Helkon might bid for the company, saying that the share purchase had acted as a catalyst for the market to realise that Winchester was undervalued.
"I personally own about four times as much as they do," Smith said. "I can't see them making a bid without them picking up the phone to me and they have not done so."
But, while Franks told Screendaily that "nothing is imminent, we are not about to make an offer", he is known to be looking at take-overs or investments in Europe as he finalises buying back Helkon SK from their German parent, Helkon Media. With media stocks at a low, the UK company has a significant war-chest from its $23 million sale to the then aggressive German concern and expects this year's bottom line to be boosted by UK hit Bend It Like Beckham.
Winchester's share prices have slumped after a series of profit warnings. The and TV group made further adjustments to its full year results this month, revising its operating loss from£8.4 million to£10.3 million.
Winchester, having built up a sales business largely based around US product such as Heartbreakers, has recently been scaling up its own UK distribution business under Mick Southworth. The company is lining up a slate of releases including Slap Her She's French in October and successfully opened Australian drama Lantana with a screen average of more than£5,785.