WPP honours deal to buy Tempus

LONDON - WPP Group is set to go ahead with its acquisition of Tempus as it today notified the Takeover Panel that it does not intend to appeal against the committee's decision that it should complete its £432m acquisition of the media-buying group.

WPP said that throughout the long-running process, the board of WPP remained convinced of the long-term strategic benefits of combining WPP with Tempus. Particularly, it said, in connection with the merger of CIA and its media-buying unit The Media Edge.

In a statement, WPP said, "WPP's objective is now for both management teams to work closely together to integrate the two businesses and capitalise on the strategic benefits as quickly as possible."

Yesterday, WPP extended its offer until November 12 as it waited for a statement from the Takeover Panel stating the reasons why it rejected WPP's bid to let its £432m offer for the media-buying group lapse.

Industry watchers had believed that WPP CEO Sir Martin Sorrell would this week bow to the decision of the panel and give up the fight to get out of the bid to buy Tempus.

Last week, the full board of the Takeover Panel rejected WPP's argument that it should be allowed to back out of its 555p-a-share bid for Tempus by invoking the material adverse change clause. The clause was invoked on the basis that the situation has changed significantly following the dramatic fall in world markets after the events of September 11.

Last Friday, it emerged that Tempus chairman Chris Ingram could walk out of the company and take his staff with him. Tempus is keen for WPP to accept the deal and end the uncertainty over its future. The threatened walkout by Ingram would be a damaging blow for WPP.

Earlier in the battle, shareholders in Tempus threatened WPP with legal action if it attempts to abandon the £432m bid to buy the company.

It is believed that WPP's case to the panel was weakened by its purchase of a further 3% of Tempus stock after September 11. This raised its stake in Tempus from the 22% it bought earlier this year to 26%.

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