Aegis rejected Omnicom takeover approach last year

by Daniel Farey-Jones, Brand Republic 05-Sep-05, 09:00

LONDON – Aegis, the marketing services group, turned down a takeover approach from larger rival Omnicom Group near the end of 2004, which would have valued the company at £1.4bn, according to reports.

The Sunday Telegraph has reported that the Aegis board rejected the informal approach after deciding the proposed price, believed by industry executives to be between 125p and 130p a share, was too low.

Omnicom was known to be sniffing around Aegis, but the pinpointing of the value it put on the company should intensify current speculation concerning a takeover, possibly by French advertising group Havas.

Havas chairman Vincent Bollore acquired a 6.03% stake in Aegis at the beginning of August at a reported cost of around £69m.

This stirred up speculation that Bollore could be set to repeat the method of stakebuilding that he used to gain control of Havas only months earlier.

One likely rationale for Bollore's move is to unite Havas and Aegis, which have complementary businesses. Aegis' two global media buying networks, Carat and Vizeum, would bolster Havas' weakness in media, particularly in the US.

However, Lorna Tilbian, media analyst at Numis Securities, said that regulators could block the deal due to concerns about the concentration of media buying power in France.

Other potential buyers, including Japanese agency groups Dentsu and Hakuhodo, would not encounter the same problem.

Aegis' share price climbed from 116.5p to 118.5p in early trading this morning, some way off the high of 125.5p it closed at after Bollore's move.

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