HomeBusinessInvestment vehicle given until April 28 to make offer for M&C Saatchi

Investment vehicle given until April 28 to make offer for M&C Saatchi

Vin Murria’s investment vehicle given another four-week extension to ‘put up or shut up’ deadline to put forward an offer for M&C Saatchi

  • AdvT formerly had until 5pm today to put forward a solid offer for the group 
  • Vin Murria is M&C Saatchi’s biggest shareholder, with a 12.5 per cent holding 
  • M&C bosses have rejected previous bids, partly on grounds of undervaluation

The acquisition vehicle in line to purchase M&C Saatchi has been given a further four weeks to make a takeover bid.

AdvancedAdvT formerly had until 5pm today to put forward a solid offer for the group, having been given an extension by the City Takeover Panel earlier this month and at the beginning of February.

But M&C Saatch today confirmed an extension to the ‘put up or shut up’ period.  

Big names: M&C Saatchi’s clients have included the audiobook service Audible, drinks producers Coca-Cola and Heineken and sporting goods giants Reebok and Adidas

Managed by technology tycoon and Saatchi deputy chairwoman Vin Murria, the investment firm now has until 28 April to say whether it will make a buyout offer or walk away – though this has the option of being extended again.

It already owns a 9.8 per cent stake in the advertising agency, which it bought in early January for £24million, while Murria is Saatchi’s biggest shareholder with a 12.5 per cent holding.

AdvT had initially proposed exchanging 1.86 of its shares for each M&C Saatchi share, a deal that valued M&C Saatchi at around £220million, as well as two further bids in the latter half of January that were also rejected.

Its most recent revised proposal offered M&C Saatchi investors either 1.94 of its shares or 40p in cash in return for each Saatchi share, a mix and match facility where the proportion of shares and cash can be varied, or an all-share offer.

Yet all these offers have been turned down by bosses at M&C Saatchi, who claimed they severely undervalued their company and left the future of current employees uncertain.

In addition, bosses raised concerns about the effect this would have on their firm’s culture, and the lack of detail and risk level in AdvT’s ‘digital-led’ mergers and acquisitions strategy. 

Discussions remain ongoing and the deadline could be extended for a fourth time should the company’s independent directors and the City’s Takeover Panel agree to such an action.

Victoria Scholar, the head of investment at Interactive Investor, said: ‘The question is whether AdvancedAdvT is prepared to sweeten its offer enough to clinch the deal, something M&C Saatchi is hoping an extra month will help achieve.

‘The latest rebuffed offer came back on 27 January, and nothing has been tabled since, suggesting the two sides could ultimately struggle to meet in the middle on valuation.

‘While the deadline extension provides a glimmer of hope, M&C Saatchi’s recent share price decline suggests investor confidence in the deal is waning.’

M&C Saatchi was started in 1995 by brothers Maurice and Charles after they were kicked out of the previous agency they co-founded, Saatchi & Saatchi, following a major shareholder revolt.

Known for its close association with the Conservative Party, the group has worked with some of the world’s most famous brands from a wide range of sectors, such as sport, fashion, energy and technology.

These have included the audiobook and podcast service Audible, drinks producers Coca-Cola and Heineken, sporting goods giants Reebok and Adidas, and media conglomerate Discovery.

Listed on the London Stock Exchange’s AIM sub-market, M&C Saatchi shares were down 0.3 per cent to £1.65 during the mid-morning on Thursday. 


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