Last week's $629 million counterbid by WPP for Tempus Group definitively answered speculation about whether or not Tempus shareholder and WPP CEO Sir Martin Sorrell would move to oppose Havas. This week, the French holding company must respond--but WPP has effectively blocked any immediate resolution in Havas' favor.
Havas has roughly 30 percent of Tempus stock, and Sorrell owns 22 percent. Essentially, Tempus has received "hard irrevocables" -- a British financial agreement that commits a buyer to purchase a certain amount of stock -- from 38 Havas senior executives to buy 25 percent of Tempus stock. On the day it announced its intent to buy Tempus, Havas also bought 3.6 percent of Tempus stock.
Havas' recommended offer of $610 million for Tempus expires this week, and Media Planning Group's parent today makes a presentation before the London Stock Exchange concerning how many acceptances it has received from Tempus' shareholders regarding its purchase offer, sources said.
It is unlikely that Havas will have the acceptances it needs to complete the merger this week, observers noted, and so the Paris-based company will probably seek an additional 21 days to gather assurances from Tempus. Only a handful of Tempus shareholders are likely to accept Havas' offer. "WPP has the higher bid, and unless Havas beats that, the Tempus board has a fiduciary responsibility to accept it," said a source.
WPP sources indicated the counterbid was a "deadly serious" attempt to add Tempus to the WPP media buying empire, which includes MindShare and The Media Edge.
Tempus' CIA Medianetwork and TME complement each other around the world. (The former is a power in Europe, and the latter is a major player in the U.S.) The two media shops have discussed the possibility of coming together in the past, noted one source. "It would be a good fit."
WPP would add CIA to its developing media-agency holding company, tentatively called GME (Global MindShare Edge), which would have billings of more than $30 billion. Under that scenario, sources said, Tempus founder Chris Ingram and TME global chairman Beth Gordon would co-chair GME, MindShare CEO Irwin Gotlieb would take the CEO chair at GME, and Mainardo de Nardis, CIA CEO, would helm TME/CIA.
Tempus, Havas and WPP declined comment.