As students of corporate takeovers know, that is no place to be in today's market. Once a public company has committed itself to a merger or takeover, it can be fatal not to go through with it. Remember Kingfisher, which in 1998 went right up to the altar with Asda, only to have Wal-Mart snatch its prize at the altar. Its strategy in tatters, the Kingfisher of that era is now no more.
So, having gone for Tempus and failed, is MPG buggered? Well, it is clearly between a rock and a hard place. The facts are that MPG is the world's ninth-largest media buyer in a world where being ninth is as good as 19th. In Europe it ranks eighth and in the UK it is 12th. Strong in France, Spain and Latin America, MPG is (literally) nowhere in Germany, Italy and Scandinavia, and not much more than a pimple in the US. Little wonder the Tempus deal made sense.
What then, given that Havas' stated ambition is to turn MPG into a top-five buyer by 2003, are its options? Answer: not many.
MPG's most favoured route must be a big agency merger, probably in tandem with Havas. But if you rule out Omnicom, the Interpublic Group of Companies and WPP, you're left with, well, Grey, B|Com3 and Cordiant, none of which are exactly star-kissed. Cordiant clearly needs a deal and owns half of Zenith, but since the other half of Zenith is already owned by Publicis, that wouldn't much advance MPG. With its three partners, B|Com3 is already an unwieldy beast preoccupied with its own problems. Which leaves Grey and MediaCom, probably Havas' best chance for a deal. But then we've been saying Grey is ripe for a deal for some years now, and still nothing has happened. And it is also important to remember that what suits MPG may not dovetail precisely with Havas' wider corporate agenda, and vice versa.
Then there is Aegis. As the last independent, the other network sharks are hardly likely to let Havas have a free run at Aegis, which would at least push up the price if nothing else. And besides, there's the inevitable competition issue in France, a potential deal-breaker.
Or MPG could buy up small media shops country-by-country. Hmmm, yes, well -- the best thing that can be said about this is that while it may make MPG look like it's progressing, it would be at the pace of a tortoise.
Fourth, as senior MPG people have indicated, there's always the possibility of joint ventures with complementary media buyers. That's true, but who's into joint ventures now? These days, ownership is everything.
Which leaves MPG going into 2002 pretty much where it was a year ago, except that its need is even more urgent, yet its options more finite.
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