Speculation is rife that Sir Martin Sorrell, chief executive of WPP, is poised to make a counter bid for the Tempus media buying agency just a month after reports that French group Havas Advertising was to take over the agency (see Tempus Shares Soar On Havas Takeover Reports).
The Havas bid of 514p-a-share values Tempus at around £425 million, Sorrell’s offer is thought to be an all cash bid worth considerably more than the Havas offer. The Tempus board has recommended the Havas offer to its shareholders but is obliged to recommend a higher cash offer if one is made, even if it does not approve of it. Sorrell is thought to be keen to execute a friendly take-over in order that senior managers within Tempus do not flee en masse.
Sorrell has met with Tempus senior executives this week and has already exercised his right as a 22% shareholder to examine the company’s books. It is thought that, should the counter-bid be successful, WPP would merge the CIA buying arm of Tempus into its own buying agency, The Media Edge.
Havas had hoped to create the world’s fourth largest media buying agency with the take over, alone it is a relatively small player in the market. It is possible that they are considering a higher offer although WPP have the upper hand, already owning 22% of Tempus stock allows the company to make a higher share bid whilst overall paying less for the company than the Havas bid.
By 11am shares in Tempus had risen from an opening price of 578p to 583½p.
