WPP Group has launched a £1.08bn hostile bid for market research company Taylor Nelson Sofres. Chief executive Sir Martin Sorrell says he was forced to table a hostile bid directly to TNS shareholders after a third approach to the board, at the same price, was rejected last week.
TNS is instead backing a £1.5 billion merger with German rival GfK and said proposals from WPP substantially undervalued the business. GfK is understood to be preparing a counter approach.
WPP’s is worth 260.6p a share, based on 173p in cash and 0.1889 of a new WPP share for each TNS share, and was made today (July 9), just before a 7.30am deadline imposed by the City’s takeover panel. TNS shareholders are due to vote on the merger with GfK on July 18 while GfK’s investors will vote on July 21.
Sorrell wants to combine TNS with WPP’s Kantar market research business, which he says will create the world’s second-largest insight, information and consultancy group.
“Although our offer may be characterised by some as a ‘hostile bid’, we believe that it is in no way hostile to TNS share owners nor to TNS’s clients and people,” he says in a statement. “In fact, WPP believes it is more committed to maintaining the TNS brand than GfK.”