NEW YORK Vincent Bollore, the French corporate raider who has amassed a 10.4 percent stake in Havas, said on Tuesday that he plans to increase his stake in the Paris-based holding company, but said he has no "current" plans to seek control of Havas. Bollore is expected to raise his stake to around 15 percent.
Havas launched a $490 million rights offering on Sept. 17, the proceeds of which will be used to refinance $810 million of convertible bonds due in 2006. The offering, underwritten by Deutsche Bank and Credit Agricole's Calyon unit, is priced at $4.01 a share. The subscription period will last for eight trading days from Sept. 27 to Oct. 6.
The issue allows existing Havas shareholders to subscribe to two new shares for each five existing shares, creating 122.5 million new shares. The additional shares will increase Havas's outstanding shares by 40 percent to 428.8 million shares.
The stock offering had been expected. "This operation will complete the swift and lasting turnaround for Havas achieved in the first half," said company CEO Alain de Pouzilhac in a statement [Adweek Online, Sept. 16].
Debt remains a lingering problem for the company. Havas said its net debt grew 12 percent to about $973 million for the first half of 2004, compared with a debt of $870 million a year ago. Separately, Havas reported first-half net income of approximately $17 million, compared with a loss of nearly $70 million during the same period a year ago, based on the current rate of exchange.
The Paris-based holding company last week said revenue for the first half fell 10 percent to $912 million from $940 million during the same stretch in 2003. However, the company said its operating margin improved to 12.2 percent during the first six months from 8.2 percent during the first half of 2003.
Havas has also confirmed it is considering a request by shareholder and corporate raider Vincent Bolloré for two seats on the company's board.
Havas came up short in its recent bid to buy Grey Global Group, when the New York-based holding company's board of directors approved a $1.3 billion cash and stock bid from London-based WPP Group [Adweek Online, Sept. 12]. San Francisco private equity firm Hellman & Friedman also made a bid for Grey.