VNU Moves to Placate Shareholders Over IMS Deal

30 September 2005

Major institutional shareholders in information giant VNU are less than euphoric over the company's decision earlier this year to spend $7 billion (€5.8bn; £4.0bn) on the acquisition of IMS Health - a supplier of data and marketing services to the global pharmaceutical industry.

Given that the purchase price exceeds VNU's market value [WAMN: 13-Jul-05], many investors view the deal as over ambitious and overpriced, a sentiment that has hammered VNU's share price.

According to VNU insiders, moves are afoot to placate the guys with the big black hats. The options include the sale of certain large VNU assets [A C Nielsen, maybe?], increasing stock buybacks and - hint some - even the dumping of ceo Rob van den Bergh.

Among the denizens of Wall Street the rumblings are said to be loudest at Templeton Global Advisors, Fidelity Management & Research and Fidelity Investments International - a formidable triunvirate if they choose to act in concert.

Gossip in VNU's executive washrooms points to IMS chief executive David Carlucci as van den Bergh's chosen usurper which, if it comes to pass, will likely coincide with completion of the deal.

VNU spokesman Will Thoretz declined to comment on whether a change of ceo has been discussed with shareholders. He did, however, confirm that there has been much consultation with the moneymen: "We've met with literally hundreds of investors," he says.

"We continue to plan to meet with investors, and we believe the vast majority appreciate the strategic rationale and long-term benefits of the deal, and take a very positive view."

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