Suitors jittery as Grey deadline looms
campaignlive.co.uk, Friday, 10 September 2004 12:00AM
Last-minute nerves appeared to be gripping potential suitors for Grey Global Group as this week's bidding deadline loomed yesterday evening.
As time ticked away before the closing time for submissions, WPP, the strong favourite to capture Grey, was said to be still mulling over an offer.
The same was true at Havas, where directors of the group were still meeting in Paris with less than three hours to go to the deadline.
The reluctance to commit came as questions arose about whether Grey, led by its chairman, Ed Meyer, was worth the $1 billion price tag placed on it by the US stock market.
Bob Willott, the editor of Marketing Services Financial Intelligence, asked whether Grey's $1.3 billion annual revenue was sustainable under new ownership; whether a poor operating margin of 6.5 per cent could be boosted to a more acceptable 15 per cent and whether clients would resist attempts to improve revenue.
"Some would ask why a buyer must pay for the improvements that the seller has so far failed to produce," Willott said.
WPP's Sir Martin Sorrell was reported to be tabling a $1.3 billion cash and shares offer for Grey.
His offer may be matched by Havas although any bid stands to be opposed by some of its shareholders who are worried about the group increasing its debt.
A major influence on the outcome could be Procter & Gamble, a bedrock Grey client. The company is thought to be unhappy about a bid by the US buyout company Hellman & Friedman which would probably resell Grey within two or three years.
This article was first published on campaignlive.co.uk
- Marketing Campaigns Officer Brand Recruitment £37000 per annum, Peterborough
- Marketing Manager Stopgap £40000 - £45000 per annum + pro rata - 6 month contract, West London
- Marketing Assistant Â– B2B Retail, £23k (Mat Cover) Blue Skies Marketing Recruitment £21000 - £23000 per annum, London
- Customer Data Manager Stopgap £43000 per annum, Bedfordshire
- Agile Programme Manager - Games / Mobile / software development Digital Gurus £55000 - £72000 Per Annum, London
- Virgin Media 'night owl' ad to break in Gogglebox
- Johnnie Walker calls global ad review
- Kevin Dundas leaves Droga5 Europe
- Testicular cancer awareness campaign launches comedy show
- Adam & Eve/DDB wins 2014 IPA Effectiveness Awards Grand Prix
- Enjoyed getting an hour back on Sunday? You'll get years back if you stop smoking, says charity