Apax Partners' £489m (€684m) bid for HIT Entertainment, owner of UK children's favourites Thomas the Tank Engine and Bob the Builder, today moved a small step closer to success after one of its rival bidders dropped out of the running.

Sources today confirmed that a consortium lead by Classic Media, the New York-based owner of rights to children's television programmes such as Lassie and The Lone Ranger, has dropped out of the running and ceased due diligence operations. No reason was given by HIT and Classic was unavailable for comment.