• by Joe Mandese  @mp_joemandese, May 26, 2006

In its most vocal opposition yet to the imminent takeover play by French financier Vincent Bollore, the board of directors of London-based Aegis Group sent a letter to shareholders this morning urging them to vote against the nominations Bollore has made for representation on the company's board. The letter comes as Bollore has raised his stake in Aegis to 29.1 percent of the company, closing in on the 30 percent threshold that would require him to make a formal offer to acquire the company under British law.

The move also comes a week after Aegis delayed its annual shareholders meeting, which was originally scheduled for May 24, to June 14, in an effort to give shareholders time to consider their options.

In the letter, the Aegis board cites two reasons why Bollore's nominations are "inappropriate." Noting that Bollore also is chairman of Aegis' Paris-based rival Havas, the Aegis board said his influence on the Aegis board would represent a "conflict of interest." Secondly, the board said it was opposed to adding directors "who may favor one particular shareholder group over and above the interests of Aegis shareholders as a whole." The letter described Bollore's nominations as the "thin end of the wedge" that would give Bollore "undue influence over the company without paying full value for the privilege."

Bollore, in fact, engineered a similar takeover of Havas, and actually managed to do so with an even smaller stake in the French agency holding company - 25 percent - than he now owns of Aegis.

Last week, on the eve of Aegis' original shareholders meeting date, Bollore nominated two directors to the Aegis board: Philippe Germond, a former French telecommunications industry executive; and Roger Hatchuel, the former owner of the Cannes Lions International Advertising Festival.

The French connection is an interesting element of the Aegis board battle, because Aegis began by reincorporating Carat, its flagship media-buying unit, as a London company. Carat Espace originally was a Paris-based company until it ran afoul of French law. Some observers believe Bollore is seeking to wrest control of Aegis partly to repatriate those assets into a French company.

Bollore also has close ties to WPP Group chairman-CEO Martin Sorrell and is believed to be discussing the possible break-up of some Aegis assets, principally Aegis' Synovate research division, which WPP would like to combine into its burgeoning research empire. Aegis' media services operations, including Carat, Vizeum, Isobar and Posterscope, presumably would be merged with Havas' MPG media operations.