Lions Gate Weighs Bid for TV Firm

Completing a proposed acquisition of the company behind Thomas the Tank Engine, Bob the Builder and Barney may not be child’s play.

Lions Gate Entertainment, a Canadian company that operates mostly in Santa Monica, is mulling over an unsolicited offer for Britain’s Hit Entertainment that could torpedo a deal that a private equity firm previously reached to buy Hit, a source familiar with the matter said Friday.

Apax Partners agreed last month to acquire the children’s television and merchandising group for $938 million.

Shareholders have yet to approve the deal. One notable investor, Britt Allcroft, took the unusual step of publishing an open letter Friday in Variety, cautioning Apax to respect the “ethics and values associated with Thomas.�

Allcroft created the television show based on the “Thomas the Tank Engine� book by British author the Rev. Wilbert Awdry. Allcroft, who is based in Santa Monica, sold her rights to Thomas in 2000. She previously served on Hit’s board and as a creative consultant.

Hit executives could not be reached to comment about Lions Gate. Earlier Friday, they acknowledged Allcroft’s contributions and loyalty to Thomas but noted that she was no longer involved with the company.

The prospective sale of Hit comes amid slumping profit caused by the weak dollar and sluggish retail sales. Chief Executive Rob Lawes was ousted last year.

A bid by Vancouver-based Lions Gate could come as early as next week, the source said. Lions Gate already boasts such family entertainment brands as Barbie videos, Care Bears and Clifford the Big Red Dog.

Lions Gate has a library of about 8,000 movie and TV titles, including such releases as “Basic Instinct,� “Terminator 2: Judgment Day,� “The Blair Witch Project� and “It’s a Wonderful Life.� The company made headlines last year when it released Michael Moore’s controversial documentary “Fahrenheit 9/11� after Walt Disney Co. refused to release the film.