Aegis Must Overcome Antitrust Concerns To Seal Synovate Sale

Aegis Group, the London-based media agency holding company, has come one step closer to selling off its market research arm Tuesday. But further hurdles need to be removed before the deal goes through.

At a special meeting in London, voting shareholders unanimously approved the proposal to sell Synovate, the company reported.

Aegis reached a definitive agreement to sell its research subsidiary to Ipsos -- a Paris-based competitor -- for about $820 million on July 27, pending shareholder and regulatory approvals.

In the Aegis shareholder vote on Tuesday, over 1 billion shares -- representing 77.7% of Aegis' outstanding stock -- voted in favor of the sale.

The deal still must pass antitrust hurdles, and Ipsos needs approval of its financing plan from French securities regulators. If it goes according to plan, the sale will close at the end of September. But Aegis issued a cautionary statement noting that the timing of the deal's closing could be pushed back if the antitrust approvals are delayed for any reason.

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At the time the sale was initially agreed to, Aegis said its shareholders would receive about $325 million of the purchase price in cash. The remaining proceeds will be used primarily to make acquisitions. Aegis said the sale of its research subsidiary would make the firm "a more focused business with scope to accelerate the delivery of sustainable, profitable growth through the implementation," of a pure-play media strategy.

That said, the proposed sale has sparked some speculation that the slimmed down Aegis might be ripe for another round of takeover attempts by bigger advertising or media firms that have no interest in the research operation.

Aegis has been in and out of play since 2005, when French corporate titan Vincent Bollore, the chairman and controlling shareholder in Havas, took a large stake in Aegis with plans to link the firms in a strategic alliance. Subsequently, both Publicis Groupe and WPP made overtures about possibly acquiring Aegis.

Even as recently as June, both Martin Sorrell -- the CEO of WPP -- and Maurice Levy -- the CEO of Publicis -- told reporters at the Cannes ad festival that they would be interested in parts of Aegis after it disposed of Synovate. But later, when pressed for details, the companies went mum.

Bollore's ardor has cooled in recent years, although he remains the single-largest shareholder in Aegis with a 26.5% stake, he now calls the investment financial as opposed to strategic. He will make a windfall on the Ipsos deal, earning about $86 million when the transaction closes.

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