Formal WPP Offer Includes TAM Deal with Ipsos

WPP has posted TNS shareholders a formal offer for the company, valuing it at $2.28bn. It includes news of an option to sell TNS' television monitoring arm TAM to Ipsos, if required to meet EU competition law.

The documents arrived over the weekend as WPP posted the offer on its web site. Sir Martin Sorrell's firm set an August 29th deadline for TNS shareholders to accept the cash and stock terms. Rival bidder and TNS' original preferred merger partner GfK said on Friday that it continues to make headway arranging its own all-cash offer for TNS, with discussions 'progressing positively'. TNS has urged its shareholders to reject the WPP bid while GfK has asked them to take no action at this time, pending details of its own offer.

WPP's previous bid valued TNS at around $2.13bn, and was rejected by TNS's board but was immediately followed by the termination of the GfK-TNS 'merger of equals' idea.

In a statement on Friday WPP said its trading since June 1 remains in line with the company's expectations for the year ending December 31. Of the potential purchase of TNS, it said: 'WPP's objective would be to return to its current gearing level by the third full year following completion. WPP also wishes to maintain its current credit ratings. As a result, the Board of WPP therefore expects that, following the acquisition of TNS, its target level for share buy-backs would be around 1% of its share capital per annum and its target for dividend growth would be around 15% per annum.'

TAM measures TV and radio audiences in 25 countries and competes with audience measurement services from WPP companies including Millward Brown. The Ipsos deal, for a maximum of £92m, has been agreed as a 'put' option which means WPP will not be compelled to go through with it if regulatory hurdles do not require it, or it finds a preferred way of dealing with them. One alternative to selling it to Ipsos might be for WPP to sell of some of its current operations, in order to keep Brussels happy.

Web sites: www.tnsglobal.com , www.wpp.com , www.gfk.com and www.ipsos.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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