TNS Pays GfK €13m for Aborted Merger Deal

GfK has received a break fee of around EUR 13m (£10.6m) from TNS as compensation for the abandoned 'merger of equals' deal planned earlier in the year. The German firm has also reported a bulging order book.

The fee was agreed as part of the merger contract made between GfK and TNS in April. The deal collapsed in July when marketing communications giant WPP made a fourth counter-offer for TNS. GfK's subsequent plans to acquire TNS were finally scrapped in August, when the German agency failed to find sufficient backing for the deal.

Expenses from the merger negotiations were fully offset by the payment, so that there are no negative effects on GfK's EPS (earnings per share). GfK received the break-fee after WPP acquired around 82% of TNS last week.

GfK has also announced a healthy order book, defying the global financial crisis: by the end of September it had posted or entered into the order book 91.6% of group sales forecast for 2008. This compares with a figure of 89.0% posted at the same point last year.

Earlier today, the firm's share price dropped 5.2% to close at EUR 18.96 per share.

At the end of last month, GfK appointed Dr Arno Mahlert to replace Hajo Riesenbeck as Chairman, and Stefan Pfander to replace Mahlert as Deputy Chairman.

Web site: www.gfk.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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