Crisis-hit Cordiant Communications revealed Thursday that some sort of deal – expected by many to be a sale to WPP Group – is near.
The agency group released a statement confirming it intends to wrap up the agreement soon. It also announced an extraordinary general meeting on June 28 to win shareholder support for the disposal of businesses in Australia and Germany [WAMN: 20-May-03; 10-Jun-03].
“The board,” read the statement, “continues to advance its discussions with various parties and is seeking to bring them to a conclusion in the very near future in the best interests of the stakeholders of the group and its clients. The board expects to write to shareholders on this matter shortly.”
Cordiant also revealed that even with the latest disposals it lacks sufficient capital to stay in business for another year, though it insists it retains “the support of its lenders”.
One subject not on the agenda for June 28 is the proposal tabled by Active Value Fund Managers, which controls 14.1% of Cordiant’s stock.
AVFM wants to replace the board and keep the group independent through a capital injection [WAMN: 04-Jun-03]. However, Cordiant bosses favour a sale.
AVFM’s Julian Treger blasted Cordiant's refusal to allow shareholders to vote on the scheme, saying it showed “that the board is committed to sealing the destruction of value that remains in the business for shareholders, without allowing the company's owners to vote on a viable alternative.”
Data sourced from: multiple sources; additional content by WARC staff