Cossette Reaffirms Support for Mill Road Bid

Marcoms and ad group Cossette - which owns Nucleus and Impact Research in Canada, and Miles Calcraft Briginshaw Duffy in the UK - has reaffirmed its support for its sale to US private equity firm Mill Road Capital.

The Cossette Board accepted Mill Road's c.$131.5m cash offer (or c.$7.87 a share) earlier this month, but then received a further unsolicited bid from Cosmos Capital, which is owned by the agency's former Vice Chair François Duffar.

Cosmos, which has been attempting to acquire Cossette since July, initially offered c.$88m but last week said it would match Mill Road's proposed price. On Friday, the firm said it would increase its offer to an even higher price of c.$8.10 per share.

Cossette says under its merger agreement with Mill Road, it may only negotiate with or provide information to a party making a bona fide written 'acquisition proposal', and has therefore asked Cosmos to respond to questions regarding the validity of its new bid.

Late on Friday, Cossette issued a statement recommending that its shareholders vote in favour of the sale to Mill Road, at a special general meeting to be held on December 18.

The agency's senior executives, who hold more than 30% of its shares, have agreed they will vote with their shares in favour of the Mill Road transaction.

Mill Road's offer represents a premium of c.40% to the trading price of Cossette's shares for the last trading day prior to the proposal, and a 142% increase on share price of c.$3.25 on the last trading day prior to Cosmos' offer.

Cossette has approximately 1,437 employees and offices in Quebec City, Montreal, Toronto, Vancouver, Halifax, New York, Irvine, Los Angeles, London and Shanghai.

Web site: www.cossette.com .