Taylor Nelson rejects WPP offer of merger as GfK deal is better

By Jane Wardell  |   2008-7-4  |     NEWSPAPER EDITION

TAYLOR Nelson Sofres PLC, the British market research firm that has agreed to a merger with Germany's GfK AG, rejected a fourth unsolicited preliminary takeover offer from WPP Group PLC yesterday.

Taylor Nelson said that the GfK deal still represented better value for shareholders, adding that WPP's continued offers and associated "commentary and innuendo" were an attempt by the world's second biggest advertising company to disrupt the planned merger.

Britain's WPP said it will only pursue the 1.08-billion-pound (US$2.1-billion) bid if it gets unanimous approval from Taylor Nelson's board.

In an increasingly acrimonious exchange, WPP said it had not had access to additional information that Taylor Nelson had shared with GfK, "which has meant that WPP has not been able to operate on equal terms to the potential detriment of TNS share owners."

In a strongly worded statement in reply, Taylor Nelson chairman Donald Brydon said that his board "has been extraordinarily patient" with WPP chief executive officer Martin Sorrell.

Brydon said that WPP had access to "materially the same information" as GfK, but maintained that their three offers undervalued the company.

"WPP has got all the information they need and have had all the time they need," Brydon said. "It is clear that WPP is determined to try and frustrate the GfK-TNS merger for the benefit of WPP's underperforming Kantar division. It is time for Sir Martin Sorrell and WPP to stop interfering and make their intentions clear."

WPP's cash-and-stock offer values Taylor Nelson at 260 pence (US$5.16) a share, based on Wednesday's closing price for WPP. That represents a 16 percent premium to Wednesday's closing price for Taylor Nelson and 52 percent to the closing price on April 28, the day before Taylor Nelson and GfK said they were in talks.

Taylor Nelson agreed in early June to merge with GfK to form the world's second biggest market research company behind AC Nielsen Corp.