NEW YORK The U.K.'s Takeover Panel, a regulatory board that oversees merger and acquisition activity, ruled today that WPP Group and its banking firm Hellman & Friedman must decide by noon on Nov. 25 whether they intend to make a formal bid for London-based holding company Aegis Group.
The ruling came as WPP reported a 26 percent rise in third-quarter revenue to about $2.4 billion compared to the same period a year ago. On a like-for-like basis, excluding the impact of both acquisitions and currency fluctuations, revenue rose about 5 percent, WPP said.
The Takeover Panel's decision came after a so-called "put up or shut up" request from Aegis, asking that the panel impose a deadline on WPP and H&F, which remain the only publicly disclosed parties with an interest in acquiring Aegis [Adweek Online, Oct. 17].
Under their proposal, WPP would add Aegis research arm Synovate, which accounts for about one-third of Aegis' revenue, leaving H&F with the media buying operations. Publicis Groupe considered a bid, but bowed out earlier this month. (Havas chairman Vincent Bolloré owns about 21 percent of Aegis, up from a 6 percent stake in August. If his stake reaches 30 percent, he must make a bid under U.K. law.)
WPP's third-quarter numbers were consistent with the company's overall 2005 growth trend. WPP said revenue rose about 23 percent during the first nine months to about $6.8 billion. That represents a gain of 5.5 percent on a like-for-like basis.
Based on that performance, the holding company has raised the guidance for its 2005 revenue growth to 4-5 percent from the previous 3-4 percent, on a like-for-like basis.
Especially strong revenue growth in North America and in the global advertising and media services sector have helped propel WPP's overall numbers, the company said.
In fact, all operating regions and business sectors have consistently shown double-digit improvement, though growth in the U.K. has slowed (less than 10 percent for Q3), as has the improvement in public relations (up 4 percent in Q3 and about 15 percent so far in 2005).
WPP said it took in more than $1 billion in net new business during the third quarter and has added more than $4.5 billion so far this year, an increase of 45 percent from the first nine months of 2004.