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Y&R to vote on WPP merger

Published on .

The marriage of Young & Rubicam and WPP Group, which will create the largest advertising company in the world, is on schedule for May 12, said executives close to the negotiations. This word comes despite reports surfacing May 11 that Publicis still was considering a merger with Y&R. Paris-based Publicis officially denied those published reports. Shareholders of New York-based Y&R on May 12 will vote on the merger during an annual shareholders meeting at the Museum of Radio & Television. Ed Ney and Peter Georgescu, chairmen emeritus of Y&R, have approved the merger, said a person close to the agency.

London-based WPP is offering 0.835 WPP share for each Y&R share. Based on a midday May 11 WPP share price of $63-1/16, the price would be around $53 per Y&R share. With 72 million outstanding Y&R shares and 19 million outstanding Y&R options, that comes to a total $4.8 billion. Based on May 5 closing prices, the deal was worth $63 per share for a total $5.7 billion.

Publicis issued a statement May 11 that it had never made any official offer for Y&R, as the conditions of the sale were considered "not optimal.'' Publicis also denied that it was again in discussions with Y&R. A Publicis insider expressed surprise at the published reports, suggesting that Y&R management opposed to the near-certain merger with WPP could be behind the stories.

Copyright May 2000, Crain Communications Inc.

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