High Noon Approaches as Cordiant Delists Shares

16 July 2003

‘Not a drum was heard, not a funeral note,’ as Cordiant Communications’ shares were laid to rest at the London Stock Exchange Tuesday.

The sole sound was the grinding of Parisian molars as Publicis Groupe digested the implications of the delisting which could see it having to pay the full contractual £75 million for Cordiant’s 25% stake in their jointly held media network ZenithOptimedia.

Publicis might have acquired the stake for far less than £75 million ($120.77m; €107.05m) – perhaps just one per cent of that sum – if Cordiant had remained listed and its control subsequently changed hands [WAMN: 15-Jul-03].

Now a week of waiting for the final act of the melodrama. On July 23 Cordiant shareholders will vote on its board’s recommendation to accept the takeover bid from WPP Group. The proposal could, however, be overturned if opposed by Active Value Advisors, the stricken ad group’s largest shareholder with around 29% of its equity.

Should the WPP deal be rejected, the meeting will then consider an alternative motion from AVA. It proposes the recapitalization of the company and installation of new management team.

This would be headed by a mystery chief executive described by AVA as a “senior executive in one of the world's biggest advertising and communications groups, with experience in the restructuring and turnaround of international advertising networks” [WAMN: 30-Jun-03].

[Might, WAMN wonders, the masked man be JF – a certain Briton, originally from the world of sales promotion – who achieved just that feat for an ailing network within Bcom3 before its assimilation by Publicis?]

Data sourced from: The Wall Street Journal Online; additional content by WARC staff