LONDON: The bugle call and dust cloud that traditionally precede the arrival of the US Cavalry are not welcome omens for Big Chief Sorrell's siege of the Taylor Nelson Sofres wagon train.
Galloping to the rescue Wednesday through the red dust of the financial badlands came the gallant troopers of Cedar Rock Capital, TNS' largest shareholder, firing their Winchesters at an offer the former can definitely afford to refuse.
Following GfK's departure from the bidding battle earlier this week many believed that WPP Group's attempt to acquire and merge TNS into its underperforming Kantar Group was a done deal.
But they reckoned without the intervention of UK fund manager Cedar Rock, whose 9.4% holding in TNS makes it the researcher's largest single shareholder. According to The Times, CRC has formally rejected WPP's hostile offer.
It's likely, however, that other TNS shareholders will stand firm in the belief that a WPP bird in the hand is worth several in the bush.
With the closing date for accepting Sorrell's offer imminent (August 29), many are thought ready to take the money and run, lest refusal triggers a fall in TNS' share price.
Although TNS ceo David Lowden says he is open to further talks with WPP, he has embarked on an eleventh-hour charm offensive in the hope of persuading shareholders to demand a better price from Sir Martin. [While buying time for GfK to try again to resurrect a counterbid?]
Lowden also voiced concern for the future of TNS if it falls into WPPs maw. “If Sorrell does not seek to engage the management, it could be detrimental to the future success of TNS. TNS is a people business and that is what makes it successful," he said.
It's likely he has in mind the silky threat uttered by Sorrell earlier this month.
"I don't think there is any such thing as a hostile takeover," quoth Big Chief Sorrell. "It's not hostile to shareholders, the people in business and certainly not to the clients. It might be hostile to the ceo."
Data sourced from Wall Street Journal Online and The Times (UK); additional content by WARC staff