M&C Saatchi to stay indie after Next 15 takeover bid fails
Shareholders have voted Next 15’s acquisition proposal down.
M&C Saatchi will not be sold to Next 15 following a shareholder vote
M&C Saatchi’s 10-month hostile takeover saga looks likely to come to a close after the last remaining bid to buy the firm failed to meet the approval of shareholders.
The proposal from Next Fifteen to acquire M&C Saatchi, one of the largest independent agency groups in the world, failed after over 89% of the company’s shareholders voted against a resolution to approve the deal during a court meeting of the company.
As such, the offer to buy the company has formally lapsed, and M&C Saatchi is no longer legally in an ‘offer period.’
The agency’s directors said in a statement: “The M&C Saatchi Directors believe in the strong, standalone future prospects of M&C Saatchi. Following the lapse of both the Next 15 Offer and the ADV Offer, the M&C Saatchi directors look forward to continuing the implementation of M&C Saatchi’s strategy as an independent business, including to: invest in high-margin businesses, enhance margins, further simplify the group, implement technology platforms, scale data and analytics capabilities and reduce costs.”
M&C Saatchi, founded by Maurice and Charles Saatchi in the 90s following their departure from Saatchi & Saatchi, employs around 3,000 staff.
In a statement, Next Fifteen said it remained confident in its future business prospects. “Next 15 will always maintain pricing discipline when pursuing its M&A strategy, which may result in certain transactions not proceeding. The Board remains highly confident in the Next 15 Group's future prospects.
“As noted in the Next 15 Group's Interim Results on 26 September 2022, strong trading in H1 has continued into the third quarter of our financial year, with results for the full financial year expected to be at least in line with management expectations. The scale and strength of our US business, combined with recently announced new client wins, give us confidence for further growth in the next financial year.“
Next 15 had offered to acquire M&C Saatchi, it emerged back in May, in a cash and shares deal that valued the business at around $390m. But in June Next 15’s own share price fell, bringing its offer price down proportionally, and M&C Saatchi’s board of directors withdrew their approval for the deal.
Next 15 then spent the next five months competing with another bidder, British tech entrepreneur Vin Murria, to gain the confidence of shareholders. Earlier this month, it formally notified the market that it expected to fail, given that Murria controlled over 20% of M&C’s voting shares and could block the proposal.
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Although M&C Saatchi’s independence is settled for now, Murria’s chunk of the business will continue to present a thorn in its side, given the radically different business model she proposed earlier this year.
While neither of the bids succeeded, the work of fighting off each proposal cost the agency millions of pounds. Chairman Moray MacLennan said that the business had spent £9.5m ($10.9m) in the first six months of the year on fighting off the bids.
This article was updated on 31 October to include Next Fifteen's statement.