The general feeling was that having built up a 22% stake, WPP's CEO, Martin Sorrell, was looking to extract maximum benefit from the opportunities presented by Havas Advertising's decision to launch a $598 million offer for Tempus July 19.
Lorna Tilbian, a former analyst with West LB Panmure Gordon and now director of the stockbroker Numis, said: "I expected this, if nothing other than to force the French to pay up and enable WPP to make more money on its stake."
Havas offered $7.84 per Tempus share, a 50% premium to its share price the day before its bid was announced. WPP offered $8.05 per share today, and Tempus shares were trading on the London Stock Exchange at around $8.43, indicating the London market is expecting a bidding war.
One analyst, who preferred to remain anonymous, said: "Sorrell has thrown his hat into the ring to stop people accepting the offer. I think he is interested to see whether Havas will bid higher. He will then decide whether to top that bid or not."
He said he believes Mr. Sorrell is genuinely keen to acquire Tempus and fold it in with WPP's existing second string network, the Media Edge. Others believe it is a strategy to drive up the price in order to facilitate the purchase of Aegis, the holding group of the media buying and planning specialist Carat.
Most analysts believe Havas will come back with a higher offer.
Ms. Tilbian said, "WPP won't overpay for Tempus, but I think they might get it." She also added that it was not inconceivable that WPP might acquire Aegis as well. -- Anne-Marie Crawford
Copyright August 2001, Crain Communications Inc.