M&C Saatchi adds another month to AdvT offer deadline

The AIM-traded communications agency said AdvT was required under the takeover code to either to announce a firm intention to make an offer for M&C Saatchi, or to announce that it did not intend to make an offer, by no later than 1700 GMT on 3 February.

Following the announcement on 24 January by the company’s independent directors, those directors confirmed on Thursday that they received a further revised proposal from AdvT on 27 January.

Under the revised proposal, AdvT would offer each M&C Saatchi shareholder 1.939 new AdvT shares and 40p in cash for each M&C Saatchi share.

AdvT would also make a mix-and-match facility available, under which M&C Saatchi shareholders would be offered the opportunity to vary the proportions of AdvT ordinary shares and cash to be received by them.

The company said AdvT had also indicated that it would increase its all-share alternative proposal, to the point that M&C Saatchi shareholders would receive 2.347 new AdvT shares for each M&C Saatchi share.

On 28 January, some of the independent directors and a representative of their financial advisers met with Vin Murria and Marwyn Investment Management - the two largest shareholders of AdvT.

At the meeting, those directors reiterated the concerns the company had previously raised, including the continued undervaluation of the company, the strategy of the enlarged AdvT group and, in particular, the lack of clarity over the deliverability of, and execution risk associated with, their proposed 'digital-led merger and acquisition’ strategy, the impact on culture, how AdvT intended to ensure the retention and appropriate incentivisation of M&C Saatchi 's key management and employees, and the valuation of AdvT's ordinary shares.

“The independent directors have also had extensive dialogue with a significant majority of the largest shareholders in M&C Saatchi and have considered the further revised proposal together with their financial advisers, Numis and Liberum,” M&C Saatchi said in its statement.

“The unanimous conclusion of the independent directors is that the further revised proposal continues to undervalue the company and its prospects, and would therefore not be recommendable.

“However, the independent directors believe that it is in the best interests of all stakeholders in M&C Saatchi to continue to engage constructively in discussions with AdvT.”

It said discussions were ongoing, and under the takeover code, the independent directors had requested, and the Takeover Panel had consented to, an extension to the deadline by which AdvT was required either to announce a firm intention to make an offer or to announce that it did not intend to make an offer.

“Such an announcement must now be made by not later than 1700 GMT on 3 March.

“This deadline can be further extended by the independent directors, with the consent of the Takeover Panel.”

M&C Saatchi’s independent directors said they continued to believe “strongly” in the future prospects of the company, noting that its “robust” financial performance in 2021 and the momentum into the start of 2022 positioned it strongly for further growth and provided increasing confidence in the success of its strategy.

“As a result, they remain confident in M&C Saatchi's ability to create material shareholder value.

“There can be no certainty that a firm offer will be made. A further announcement will be made in due course.”

At 0936 GMT, shares in M&C Saatchi were up 3.81% at 183.75p.