Liberum acts as Joint Financial Adviser and Independent Rule 3 Adviser to M&C Saatchi PLC on the successful defence of a hostile offer and unrecommended offer
We are pleased to announce that Liberum has acted as Joint Financial Adviser to M&C Saatchi PLC (“M&C Saatchi”), a leading digital marketing and advertising company in the UK and globally, on its successful defence of two offers.
Liberum provided financial advice to the Company following the unsolicited, hostile approach from AdvancedAdvT Limited (“ADV”) on 4 January 2022. ADV is a main market cash shell led by Vin Murria who at the time of the approach was Deputy Chairwoman of M&C Saatchi. ADV also launched a “dawn raid” building a stake of 22% (10% owned by ADV and 12% owned by Ms Murria). Subsequently, ADV announced its formal offer for M&C Saatchi on 17 May 2022 (the “ADV Offer”). The implied value per M&C Saatchi share of the ADV Offer was 207.5p, and valued M&C Saatchi at £253.6m.
Liberum advised the Board of Directors of M&C Saatchi that, among other things, the ADV Offer represented a significant undervaluation of the future prospects of M&C Saatchi and as such, on 17 May 2022, the Directors of M&C Saatchi formally rejected the ADV Offer and published its Defence document on 28 June 2022. Liberum also reported on a profit forecast for FY22 and FY23 that the Board issued, to help shareholders appreciate the valuation arguments.
Liberum’s advice included the identification of Next 15 Communications Limited (“Next 15”) as a white knight alternative to the ADV Offer. Following solicitation and private negotiation, Next 15 announced a recommended offer for M&C Saatchi on 20 May 2022 (the “Next 15 Offer”). The Next 15 Offer represented an implied value per M&C Saatchi share of 247.2p, valuing M&C Saatchi at £310.1m.
Following a material deterioration of the Next 15 share price after the announcement of the Next 15 Offer, the implied value of the Next 15 Offer fell below that of the ADV Offer and below a value that was deemed recommendable. Accordingly, on 17 June 2022, the Board of M&C Saatchi announced that they could no longer recommend the Next 15 Offer and advised that M&C Saatchi shareholders not vote for the Next 15 Offer.
ADV accelerated their Offer on 8 September 2022 but the ADV Offer failed to receive sufficient support from M&C Saatchi shareholders and as such lapsed on 30 September 2022.
The Next 15 Offer, once it had received US regulatory clearance, proceeded to the Court Meetings on 31 October 2022 where the majority of M&C Saatchi shareholders voted against the Next 15 Offer in line with the Board’s recommendation.
Throughout, the M&C Saatchi Directors have continued to believe in the strong standalone prospects of the Company. Following the lapse of the ADV and Next 15 Offers, the Board of M&C Saatchi look forward to continuing the implementation of M&C Saatchi's strategy as an independent business including to: invest in high-margin businesses, enhance margins, further simplify the group, implement technology platforms, scale data and analytics capabilities, and reduce costs.
The circumstances and timing of the ADV and Next 15 Offers set a number of precedents for UK public takeovers, including ground breaking aspects culminating in a Panel statement on overlapping timetables.
Liberum and Numis acted as Joint Financial Adviser to the Company over the course of the ADV and Next 15 Offers.
Liberum has been Joint Corporate Broker to M&C Saatchi since January 2021 and Nominated Adviser since 20 May 2022.
Investment Banking – Neil Patel, Tim Medak, Mark Harrison Ben Cryer, Will King