More details have emerged on the potential takeover of the communications agency M&C Saatchi on Friday, with AdvancedAdvT announcing its interest in exploring a share exchange merger in a regulatory update.
The AIM-listed company confirmed on January 5 that it had acquired 12 million ordinary shares of M&C Saatchi.
On Thursday, M&C Saatchi said in its own announcement that AdvancedAdvT, which is linked to its director Vin Murria, had made a preliminary approach on a potential offer.
The board of directors of AdvAdvT said on Friday that it believed the larger group would have the opportunity to create “significant value” for its shareholders.
“A merger would create an opportunity to build a creative, data-driven, analytics, and digital marketing company with a strong track record and additional managerial expertise in rapidly transforming businesses and executing complementary mergers and acquisitions.” , the company said in its statement.
âThis would allow the enlarged group to continue its development and, above all, to accelerate the implementation of its growth strategy and therefore to be more and more relevant for its customers.
“The board believes the larger group would be well positioned to take advantage of structural changes resulting from accelerating digitization, affecting the way businesses operate, engage and sell to customers, and deliver benefits to customers. employees, customers and shareholders. “
AdvancedAdvT said the merger, combined with a focus on a data strategy, digital analytics and creative marketing as well as mergers and acquisitions, would allow the larger group to capitalize on the increased opportunity to “navigate, create and drive meaningful change âwhile guiding customers on theirâ new digital journey â.
He added that he would defend M&C Saatchi’s traditional creative base against disruptive competitors and allow the larger group to increase its market share relative to its peers.
The company said the merger would also allow M&C Saatchi to resolve its legacy put option issue, as well as provide liquidity to accelerate investments in the business and transformational, digitally-driven mergers and acquisitions.
âThe company brings additional management skills with considerable expertise and experience to complement, accelerate and develop the larger group through strategic and targeted acquisitions in fragmented international markets,â said AdvancedAdvT.
âThe management of the company has already succeeded in identifying, realizing and exploiting the latent value within the companies.
“The combination of M&C [Saatchi] the brand and the platform with the financing and corporate experience is expected to increase the pipeline of merger and acquisition opportunities.
AdvancedAdvT also said that the platform’s âcombined reach and renewed appealâ could attract many quality assets.
The board said the outperformance and rating of data-driven digital marketing agencies and board peers demonstrates investor support for companies that have capitalized on the perceived market opportunity.
He said other digital marketing groups have been successful in using mergers and acquisitions to acquire digital capabilities.
âWe see a significant opportunity for the extended group, with an accelerated data, analytics and digital strategy and combined management, to achieve similar valuation multiples, to improve equity liquidity, to implement a gradual reinstatement of the dividend policy which, in our opinion, will improve the attractiveness of the company for investors.
AdvancedAdvT has confirmed that its chairman Vin Murria, also a non-executive director of M&C Saatchi, held 15,237,985 shares of the latter, representing 12.46% of its issued share capital.
Murria also held 17,500,000 shares in AdvancedAdvT, representing 13.26% of its issued capital.
“There can be no certainty that a formal offer for M&C will be made, nor as to the terms of any such formal offer.”
As the company’s purchase of 12 million shares of M&C Saatchi constituted a reverse takeover under the listing rules, AdvancedAdvT had requested that its shares be suspended from trading until the FCA approves. its eligibility after purchase.
Shares of AdvancedAdvT closed 5.77% lower at 98p on Thursday, the last trading day before its suspension, while those of M&C Saatchi were down 10.59% at 1252 GMT on Friday at 187.76p.