Havas' bid for Tempus faces threat from WPP

WPP is on the verge of launching a counterbid for Tempus, which

could scupper Havas' takeover.

Sir Martin Sorrell, the group chief executive of WPP, has been in talks

with senior Tempus executives about a deal that would smash Havas'

541p-a-share cash offer. The Havas offer values Tempus at £425

million but WPP may decide that a higher bid is good value because it

paid just 200p a share for the 22 per cent of Tempus that it already


JP Morgan, Havas' adviser on the deal, has made a complaint to the

Takeover Panel, urging WPP to clarify its position. Havas' advisers

claim that uncertainty over WPP's intentions is contributing to

fluctuations in the share price of WPP and Tempus. Tempus shares rose

2.64 per cent to 583.5p on Wednesday morning and WPP shares were down

2.42 per cent at 685p.

Discussions between WPP and Tempus are thought to have focused on likely

synergies between the two groups and positions for senior executives if

a bid is made. One possibility would be a merger of CIA with WPP's The

Media Edge, which was acquired as part of WPP's takeover of Young &

Rubicam last year.

City sources are predicting that if Sorrell decides to move, he will

make a bid by Monday. WPP's half-year results are announced on Monday

and it also marks the first closing date on the Havas bid with

institutions moving forward on the offer.

However, WPP or any other prospective buyer has until 28 September to

table a bid.

Chris Ingram, the chairman of Tempus, would be obliged to recommend a

higher cash offer from WPP despite his own reservations about a


Havas refused to say whether it would return with a higher offer if WPP

makes a bid.