Yesterday’s peanuts are today’s banquet at the Paris table of Publicis Groupe chairman Maurice Levy.
Having in March scornfully dismissed as “peanuts” Interpublic’s offer of 1.14 of its shares for each True North share, Levy yesterday told French financial weekly Le Journal des Finances that a recovery in TN’s share price meant that the network is now valued at a price that stimulates his salivary glands.
"Interpublic's initial offer did not satisfy me,” said the Gallic gourmand whose group owns a 9% stake in TN.
“Since then, True North's share price has come into its own, valuing the deal at $200 million, based on a level of $43 per share, or a capital gain for Publicis of more than $180 million. I therefore do not intend to oppose this deal,” he revealed, “given the valuation level obtained for our shareholders."
Levy also predicted that Publicis’ revenue growth for 2001 would exceed market performance, although the levels of 2000 were unlikely to be repeated
"Even if we are convinced that in 2001 and 2002 we will register growth above, and even largely above, that of the market, we will have a lot of trouble in the current context in repeating the performance of the 2000 vintage, which will go down in the annals of advertising as quite an exceptional year," he said.
The effects of a slowdown in the United States, where the group garners 44% of its turnover, would limit earnings, although he expects the European market to grow by between 3%-4%.
Levy is also eyeing opportunities in Japan – the globe’s largest advertising market outside the USA. The ideal acquisition would rank among Japan's top twenty shops.
"At the moment, we have several paths for breaking into this market,” he said. “But our choice would be an agency that will give us good control through a long-term majority stake.”
News source: CampaignLive (UK)