• by Richard Whitman , Columnist, May 17, 2022

Talks between AdvancedAdvT and M&C Saatchi over the value of the latter have taken a hostile turn.

Advanced and the UK-based agency have been haggling since the beginning of the year over the value of the agency.

Advanced revealed a formal takeover offer today—rejected almost immediately by Saatchi—that values the company at roughly $335 million, based on yesterday’s closing share price for Advanced.  The offer includes both all shares and cash-plus-shares options.

Advanced is led by Vin Muria who is also an independent member on the M&C Saatchi board.

The proposed buyer says it has already lined up commitments from holders of 42% of Saatchi’s outstanding shares including shares already held by Advanced.

It has also lined up several industry veterans to be independent members of the combined Advanced-Saatchi entity if the deal goes through including Tamara Ingram, former CEO of J. Walter Thompson and who was just named executive chair of UK content company The 10 Group.

Christopher Sweetland, formerly the Deputy Group Finance Director of WPP Group, would become a non-executive director and Chair of the Audit & Risk Committee pending completion of the transaction.

Advanced has stated big expansion plans beyond the M&C Saatchi deal, including a number digital marketing, tech and transformation acquisitions. The company has argued that M&C Saatchi would be in a better position to thrive as a creative agency if bundled within a broader group with access to more resources than as a standalone agency.

In its rejection notice, and like similar statements it has made since M&A talks began, Saatchi said the Advanced offer undervalues the company. The offer was unanimously rejected by all of the agency’s independent directors and the 18 members of its executive committee who believe that a successful takeover would lead to both key clients and talent jumping ship to the detriment of the agency.

Saatchi also stressed that Advanced is based in the British Virgin Islands and as such is not subject to the provisions of the UK’s takeover code. Should it succeed in taking over the agency, shareholders could lose protections offered by that code.