Digital marketing group Next Fifteen has struck a £310m deal to buy M&C Saatchi, gazumping tech entrepreneur Vin Murria’s attempt to buy the ad agency.
London-listed Next Fifteen, which has a £1.2bn market valuation, has tabled a cash and share offer for M&C Saatchi that it aims to seal through a scheme of arrangement.
The use of the court-approved tactic, which requires Next Fifteen to get approval from 75% of shareholders, forces any investors against the deal to sell once the threshold is met.
M&C Saatchi’s independent directors, who have rejected four offers from Vin Murria’s investment vehicle AdvancedAdvT (ADV) since January, have unanimously recommended the offer to shareholders.
“The M&C Saatchi independent directors are pleased to unanimously recommend this alternative, more attractive offer which we are confident is in the best interests of M&C Saatchi shareholders and M&C Saatchi’s other key stakeholders,” said Gareth Davis, chairman of the agency group.
“The M&C Saatchi independent directors all consider Next Fifteen’s offer to be far superior to the offer announced earlier this week by ADV, and a clear repudiation of ADV’s response statement that it strongly disagreed its bid undervalued M&C Saatchi.”
The company board called Murria’s latest offer, which valued the business at £254m, “derisory” and said there was a “total lack of support” from its 18-strong executive team, which feared a talent and client exodus.
Murria is deputy chair of M&C Saatchi and its biggest single shareholder, and ADV control 22% of the agency. Earlier this week she said that her latest offer had support from a further 21% of M&C Saatchi shareholders, although she had only secured irrevocable undertakings committing to it from a few per cent.
“This is an exciting opportunity to bring together two highly complementary businesses creating a truly global and diversified group with exceptional capabilities, clients and talent,” said Tim Dyson, chief executive of Next Fifteen.
“M&C Saatchi is synonymous with creativity and strategy, whereas Next Fifteen has built a reputation around its technology and data-driven offering. This makes for a great combination, and we are confident we can accelerate the ambitions of both businesses, creating significant value for our clients, our people and our shareholders.”