Holders of Bcom3 shares when the deal closed Sept. 24 have struggled to take to market a block of debt securities included as partial payment for their shares. The notes, known by their French acronym OBSA, were originally set to be traded on the French securities market shortly after the merger closed, according to the proxy statements filed before the close.
But the OBSA Settlement Corp.-a corporation headed by former Bcom3 management set up to handle the OBSA sale-opted late last year to pursue a private placement of the debt due to the weak securities market, and has actively tried to structure a sale through underwriter Dresdner Kleinwort Wasserstein. Publicis Groupe's weak financial performance also has cooled investor interest, according to one executive close to the situation.
Over the past three months, Bcom3 shareholders have gotten updates explaining the delays, according to insiders. After the sale failed to happen following the close of the merger, the sale target was pushed to the fourth quarter of 2002, then to early 2003. In a current memo, OBSA Settlement Corp. said it now is "proceeding with a sale of the OBSA notes through a structured finance transaction." The memo went on to say, "This is a complex process. It involves more work by [OBSA Settlement Corp.], and takes more time than many (less attractive) alternatives." Company officials did not return calls by press time. "It all boils down to we can't sell the OBSAs," said one frustrated shareholder. "They basically don't know when they will sell."
What may quell shareholder frustrations is a March 15 bonus that Bcom3 shareholders were scheduled to receive. If not, shareholders may vent their frustrations when a six-month lockout expires March 25, and they will be able to sell up to 25% of their holdings.