ITV is considering acquiring Entertainment One, the Canadian media company that is also known as eOne. The British broadcaster has already had preliminary rounds of discussions with eOne, which owns the majority share of British cartoon series Peppa Pig.

While sources aware of the situation informed the Financial Times that a decision is yet to be taken, eOne said: "No approach has been received."

ITV, which airs television series such as Downton Abbey and The X Factor, has gained financially over recent years because of high advertising revenues, thus giving it deep pockets to finance a new takeover deal. In an effort to strengthen its portfolio, the company has already completed some deals over the past year. However, the hunt is ongoing for the broadcaster, who is now looking to acquire TV production assets to reduce reliance on cyclical ad revenues.

On the other hand, eOne has been under pressure from investors post its acquisition deals. It had acquired majority stakes in the Mark Gordon Company, the maker of Grey's Anatomy, and in Astley Baker Davies, the creator of Peppa Pig. It has had to issue new debt to the tune of £285m (€358.36, $403.33m) in order to replace its existing facilities.

Adding to eOne's woes is its negative cash flow. This was because it was required to pump in money prior to the release of its new films and programmes. These have led its share price to drop by 50% over the last 12 months, which in turn reduced eOne's valuation to £678m, making it a potential takeover target.

In December 2015, analysts at Canaccord, a Canadian investment banking and financial services company, said: "With the [eOne] group trading at a two-year low, the stock may start to look like a takeover candidate itself." The news also comes at a time when it is believed by a few analysts that increased competition from Netflix, Amazon Prime Instant Video and other on-demand platforms could see a fresh round of consolidation in the European media space.