WPP’s plans to buyout Cordiant Communications may be scuppered yet, if intransigent majority shareholder, Active Value, manages to gather together a sufficient holding in Cordiant to block the deal.
Active Value has explicitly stated that it would like to see Cordiant remain independent and has proposed to inject more money into the business in order to achieve this. Cordiant’s Board and (allegedly) clients favour selling the company, hence the Board’s support for the WPP bid.
However, the proposed deal must go before shareholders before it can be sealed and Active Value has yesterday and today increased its holding in Cordiant to give itself more sway in the decision.
The group bought a further 30 million shares in Cordiant, taking its total holding to 23.9%. It is undertsood that Active Value needs just over 25% in order to be able to block WPP’s proposal at the shareholder meeting.
Active Value is also planning to convene an EGM to discuss its plans for Cordiant, which would inject more cash into the business and replace its management.
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