Cinven is Possible GfK Investor

GfK is understood to have had talks with European private equity firm Cinven about finance for its bid for TNS. Such a partnership is likely to be treated with caution by major shareholder the GfK-Verein.

The Daily Telegraph reports that GfK, Cinven and at least one other buyout group have been in discussions about the £400m to £600m needed to outbid last week's £1.08bn offer made by Sir Martin Sorrell's WPP group.

GfK, which last week cancelled its nil-premium merger with TNS, has also been in talks about possible financing from Tchibo coffee empire billionaires Günter and Daniela Herz. GfK CEO Klaus Wübbenhorst stated last week that his firm is looking for a long term investor, and confirmed that the Herz siblings' investment vehicle Mayfair could provide backing for the bid.

The GfK-Verein charitable trust, GfK's largest shareholder, is said to prefer the option to deal with a long-term German investor.

According to reports, GfK-Verein, which owns 57% of GfK and has 570 voting members, will attach restrictions if GfK links up with a private equity partner. Its conditions are that the investment would have to be directly in TNS rather than a bid vehicle that would own both companies, and that the partner would not be offered a seat on the Board.

Since WPP made its 260.6p per share bid for TNS on 9 July, its own share price has fallen from 464p the day before the offer to 433p this morning. This affects the group's offer for TNS, which comprised 173p in cash and 0.1889 of a new WPP share for each TNS share and would now value TNS at £1.06bn.

Web sites: www.gfk.com , www.cinven.com , www.tnsglobal.com and www.wpp.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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