With 86% of LBi International’s shares either already purchased or subject to irrevocable undertakings, it is hard to envisage any circumstances that would prevent Publicis concluding its takeover bid next January – provided the regulators don’t intervene.
And the possibility of a counter-bid is even more remote although, as Publicis chooses not to remind us, the so-called irrevocable undertakings are actually not quite what they seem. If LBi shareholders receive an offer worth at least 9% more than the Publicis proposal, the current deal may be terminated although Publicis has secured the right to match any other such superior offer. Mind you, if the Publicis deal were to fall through in the face of a better rival offer or a withdrawal of the LBi management’s support, LBi may be liable to pay a termination fee of €7.5 million to Publicis.
Today Publicis followed up its original outline proposal with a formal offer that requires a response by 12 January 2013. The issue of the formal offer implies that the regulators have either given their approval or intimated that approval is likely to be forthcoming.
So in a few weeks’ time many of the LBi managers and private equity backers will be pocketing a 100% gain and Publicis will own an even bigger share of the digital marketing sector. Whether that concentration is sufficient to merit examination by the European Commission remains to be seen, but you have to hand it to Maurice Lévy: he’s got vision and determination – qualities that must irritate his arch rival Sir Martin Sorrell.
Bob Willott is editor of “Marketing Services Financial Intelligence”