WPP informed the London Stock Exchange today that as of 3 p.m. Oct. 1, the first closing date of the offer, valid acceptances had been received by 93.9% of Tempus shareholders, well ahead of the 90% threshold needed for the deal to go ahead.
Havas Advertising, which originally made a friendly bid for the U.K.-based Tempus for international media buying and planning specialist CIA, withdrew its offer Sept 21., citing a slowing world economy and the falloff in advertising following the terrorist attacks on the U.S.
Although WPP's offer is 555 pence per share of Tempus stock, the target's share price fell Oct. 1 by 7.89% to 437.5 pence. Last week Cordiant Communications Group issued a profit warning and sent share price's in the whole sector tumbling.
WPP's offer values Tempus at $639 million, and there are concerns that if the stock markets continue to slide the company could be seen to be overpaying.
Some analysts were divided on whether the deal would go ahead.
"Clearly one cause for concern is the material adverse change condition. [WPP Group chief Executive Martin] Sorrell will be talking to the company to gauge just what the adverse change in the forecast is likely to be for next year. And even though Sorrell bought Tempus shares [after the Sept. 11] strikes, he could argue it simply gave him a blocking stake," said one London analyst.
Another unnamed analyst said that "the adverse condition was saber-rattling by WPP. I still think they would quite like the CIA network."
By noon today London time, WPP's share price had fallen 6.1% to 453 pence.