AdvancedAdvT (ADV for short), which is waiting for M&C shareholders to accept its own bid, almost certainly has the power to torpedo Next 15’s offer. This is because it owns 22.3% of the advertising and marketing group and the Next 15 offer requires at least 75% of votes cast to be in favour.
The threat weakens the working assumption that AdvancedAdvT would have been happy for Next 15’s bid to succeed because it would have made a profit on its shareholding.
AdvancedAdvT is the investment vehicle of technology investor Vin Murria, who acquired a 12.5% stake in M&C in 2020 for around a third of the 150p level that its shares are currently trading around. The stake was bulked up this January with ADV acquiring 9.8% of M&C at 200p per share.
ADV’s more aggressive stance was revealed today (15 August) when it also announced it had now received all mandatory regulatory clearances for its offer – in apparent contrast to Next 15, which is still waiting to hear from the US Committee on Foreign Investment (CFIUS).
However, ADV’s claim was subsequently criticised by M&C, which pointed out that ADV has not applied for CFIUS clearance. M&C’s directors believe this risks CFIUS looking into the deal after it closes because M&C Saatchi Group is a contractor for the US government.
ADV said in relation to the Next 15 offer: “ADV continues to believe that although Next Fifteen Communications plc is a credible buyer of M&C Saatchi, its offer price does not reflect the value of foregoing control and the significant synergies available to NFC. Based on the current implied value of NFC's offer, ADV and Vin Murria intend to vote their shareholdings in M&C Saatchi against NFC's scheme.”
The implied value of Next 15’s offer fluctuates because the main component is Next 15 shares. When Next 15 announced the offer in May it valued M&C at £310m, but its closing share price 12 August means the offer’s value is now £248m.
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