(Alliance News) - Acquisition vehicle AdvancedAdvT Ltd said Monday it has improved its takeover offer for London-based advertising agency M&C Saatchi PLC to include a cash element, but this has been rejected by the M&C Saatchi's independent directors.
M&C Saatchi shares were up 2.1% to 178.70 pence early Monday. AdvancedAdvT shares were unchanged at 98.49p.
AdvancedAdvt offered 1.633 AdvancedAdvt shares plus 40 pence cash for each M&C Saatchi share. The offer was an alternative to an all-share offer of 2.245 AdvancedAdvt shares for each M&C Saatchi share.
At current prices, the mixed offer is worth 200.83p per Saatchi share, a 12% premium. The all-share offer is worth 221.11p, a 24% premium.
Under the mixed offer, M&C Saatchi shareholders would own about 57% of the enlarged company, while under the all-share offer they would own 65%. Both calculations exclude the 12 million shares of M&C Saatchi - a 9.8% stake - already owned by AdvancedAdvT.
AdvancedAdvt also said it would move its shares to AIM, where M&C Saatchi currently is listed, from the London Main Market as part of M&C Saatchi offer. But following the rejection, AdvancedAdvT said it is "considering its options".
Vin Murria, the executive chair of AdvancedAdvT, is an M&C Saatchi director as well. AdvancedAdvT also is backed by Marwyn Investment Management.
AdvancedAdvT said it would name Murria as chair of a merged company, while M&C Saatchi Chief Executive Officer Moray MacLennan would remain in post.
"The board of AdvancedAdvT believe this is a truly beneficial merger; it provides significant investment and additional expertise to build on the existing M&C platform, seeking to drive M&C's future growth at significantly greater pace for the benefit of all stakeholders," it said.
M&C Saatchi hadn't made a public response to AdvancedAdvT by late morning on Monday.
By Tom Waite; thomaslwaite@alliancenews.com
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