After months of resistance from some of the agency’s major shareholders, Bain Capital has succeeded with its tender offer to take Japanese ad agency ADK private, having acquired a little over 87% of the firm.
The deal, confirmed early Thursday, ends a nearly two-decade-long and often contentious relationship between ADK and WPP, which had been ADK’s single largest shareholder, with a 25% stake.
When Bain first made its tender offer a few months back, WPP rejected it, arguing that the offer (about $1.35 billion for a little over half the company) undervalued the agency.
In late October, WPP even took legal steps in Japan in a bid to prevent the offer from going through. Last month, however, the holding company made an about face and agreed to tender its shares.
At that time, Bain stated if the tender were to succeed, it would “discuss” a potential re-investment by WPP in ADK via Bain. “Any future cooperation will be discussed in good faith by both parties,” Bain stated. There was no mention of any such talks today when the investment company confirmed the acquisition.
But a WPP spokesperson said: "We're delighted to have the opportunity to reinvest in the new Bain-controlled ADK and realize a substantial capital return at the same time."
Yuji Sugimoto, a managing director at Bain Capital Private Equity, stated: “Today’s successful tender offer marks an important step in the right direction for ADK as we move closer to privatizing the business in order to better secure its future in a fast-changing market.”