WPP Agrees to Proceed With Tempus Purchase

NEW YORK – WPP Group has dropped its resistance over completing its $629 million purchase of Tempus, just a day after the Takeover Panel rejected WPP’s latest appeals to withdraw its offer for the company.

The decision to proceed came during emergency meeting held yesterday to discuss the panel’s executive committee ruling against WPP. The company had claimed that Tempus’ value suffered material adverse changes, and the buyout offer should therefore be nullified.The board meeting was called by WPP chairman Philip Lader.

According to the panel’s document — which has not yet been released publicly — for a company to meet the MAC test, “an adverse change of very considerable significance striking at the heart of the purpose of the transaction in question” is required. WPP could have further appealed but today decided to cease the appeal process, citing the reasoning behind the panel’s ruling.

As one source interpreted the panel’s decision, “For the MAC clause to be invoked, the situation has got to be catastrophic, so that the purpose of the business is such that its existence is no longer and that the only remedy is to therefore stop the transaction.”

In anticipation of this decision, on Monday WPP asked for its bid to be extended through Nov. 12.

Tempus officials were unavailable for comment.