Advertisement in Merger With French


Havas Advertising is merging, the struggling i-shop acquired in its $2.1 billion purchase of Snyder Communications last year, with its Euro RSCG Worldwide network.

In addition, Baltimore-based's tracking stock will soon vanish from the Nasdaq Exchange. Havas plans to issue 1.95 million of its own shares to stockholders in exchange for 100 percent of tracking stock, which was launched in 1999.

Based on the $14.81 closing price on Feb. 2 for its stock, Havas would exchange 0.0857 shares for each share. shares were trading last week around $1.15, versus a 52-week high of $14.75 and a low of 41 cents. Havas of Paris acquired all of Snyder's common stock last September. "When we purchased Snyder, we thought it worthwhile to see if the delivery of those capabilities through a separate business unit such as had strategic or financial advantages.We have concluded it does not," said Havas chairman Alain de Pouzilhac.

"The good news for Havas is they get Circle [shares] at a discounted rate," compared to just a few months ago, said industry consultant Bill Montbleau. "The bad news is the future of these [interactive] divisions—how do you make money?"

The transaction, subject to shareholder approval, is expected to be finalized before mid-year, said R. John Cooper, executive vice president, worldwide general counsel and managing director at the U.S. headquarters of Havas.