All those châteaux in the south of France that Tempus Group shareholders were making down payments on are back on the market. WPP Group has petitioned the English Takeover Panel to allow it to withdraw its bid to buy Tem pus because of a "material adverse change" proviso, almost never invoked, that allows public firms in the U.K. to back out of takeover plans if something unforeseen or unprecedented happens.
Both adjectives apply to Sept. 11 and its aftermath. So the WPP-Havas struggle for Tempus, which had been an engrossing spectator sport for media players on both sides of the Atlantic for the past few months, is all but over.
Havas bowed out, WPP is backing out. Tempus shareholders, having come so close to a windfall, can now do little more than watch their stock value sink. Tempus staffers, meanwhile, will continue to weather the job anxiety their bosses have helped provide these last few months.
True, there are still some procedural hoops to jump through. But the chances of a deal going down are about as good as seeing Bill Maher show some restraint on Politically Incorrect.
Perhaps fittingly for a European takeover battle, the struggle for Tempus ended like so many soccer matches: Nobody scored.
Nevertheless, its consequences are far from negligible. Indeed, it offers some intriguing clues about subtle—but significant—changes in the communications business.
The mainstream media's take on how recent events have affected the industry has typically been myopic and simplistic. Myopic because it obsesses about whether we will watch Survivor as bombs fall on Kabul. And simplistic because it has limited its exploration of the impact on communications to interviewing "experts" on how much revenue the networks lost. (E! asked to interview me about that three days after the attacks. I declined, not just because it would have been hugely inappropriate, but because, really, what insights could I offer on terrorism that Joan Rivers and Steve Kmetko couldn't?)
One thing that hasn't changed is the hubris of these content providers. I have to tell you, the terror-themed episode of The West Wing brought tears to my eyes. Really. I say, let Aaron Sorkin get as high as he wants, dammit.
No, if you really want to understand the depths of change in media, look no further than the Tempus in your teapot. The likely death of that deal is a sure sign that the giant global media networks' drive to outsize each other has run smack into a material adverse change.
Sir Martin Sorrell clearly coveted CIA, and with good reason. The deal made sense. And in the bigness contest, he needed to keep up with John Dooner and stay ahead of John Wren. CIA chairman Chris Ingram understood that sooner or later, you either join WPP, IPG or Omnicom, or they beat you to a bloody pulp and force you to join them anyway. Havas knew it needed to grow for the same reasons.
Still, Sorrell couldn't in good conscience go through with a takeover—at a set price—of a company that's worth millions of dollars less today than it was in August, when he first made his play.
What we've got here is the mother of all material adverse change conditions, folks.
The relentless tide that obliter ated the TN Media brand, made strange bedfellows of MindShare and The Media Edge, engendered bizarre scenarios like Initiative buyers working at Deutsch, and killed off venerable media independents like TBS, has finally found a shore on which to crash.
This is good news for entrepreneurs like Bill Koenigsberg, whose Horizon Media remains stubbornly independent (though it now operates in Europe and Atlanta, and its $1 billion in billings almost put it in the big leagues, too). And it can only help Zenith Media, which has been feasting on the big boys for more than a year in reviews and whose Publicis parent legally completed Zenith's marriage to Opti media just as the Tempus deal was going bad.
With WPP buying Tempus, the rich were sure to get richer. Without that deal—and with conditions likely to discourage similar ones in the future—the smaller and independent players suddenly have new power. The rush to bigness may slow to a crawl, or even stop altogether, at least for now.
A faltering economy and plummeting ad fortunes started the trend, sure. But a madman in a cave in Central Asia may have cemented it.