De Pouzilhac confirms Havas interested in acquiring Grey
LONDON - French advertising group Havas is interested in buying Grey Global Group, the French advertising giant's chairman and CEO, Alain de Pouzilhac, said in an interview today.
De Pouzilhac told the French newspaper, Le Figaro, that he could confirm Havas's interest in acquiring the New York-based Grey, and that the company already had financial backers in place.
In the interview, he said: "It is effectively something that could interest Havas in terms of our strategy and our financial plan. Grey has strong points where Havas is not as strong and vice versa."
Havas is in talks with the US private equity firm Blackstone about making a possible bid, although reports say that discussions could still break down.
If Havas were to buy Grey, it would boost the revenues of the mid-size holding company by an estimated 50%, although there is some debate whether it can afford to do the deal. As the smallest of the advertising groups, it would not be able to pay in cash, which Grey chairman Ed Meyer will be looking for.
"People in the market say Havas doesn't have the financial means -- but we do because we have financial partners,'' de Pouzilhac said. "We are not irresponsible. We will look at it and, if we are interested, we will solve the convertible bonds issue before that."
De Pouzilhac specifically cited the possibility of merging Grey's media unit, MediaCom, with Havas's Media Planning Group, a move that would create the biggest media agency in the world.
However, he warned that his priority was focusing on delivering profits for Havas this year and that the deal would only be done if it created value for the company's shareholders.
With WPP Group already expressing an interest in Grey, it could mark the second time that the two advertising groups have gone head to head in a battle to gain control of a smaller company. In the summer of 2001, the City was gripped by the contest between WPP and Havas to take control of CIA-owning media group Tempus -- eventually won by Sir Martin Sorrell's WPP.
A third party, the San Francisco-based buy-out group Hellman & Friedman, has also expressed an interested in acquiring the group.
Grey has confirmed that it has hired financial advisers to look at options, including a sale. However, it has ruled out selling off the business piecemeal. Along with MediaCom, it owns the advertising agency Grey Worldwide and the PR shops GCI Group and APCO.
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