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WPP Gets EU OK
WPP has received a qualified approval from the European Commission for its offer to buy TNS. The deal will comply with EU merger rules, provided two divestments are made.
The Commission's decision is dependent on WPP divesting both TNS' television monitoring arm TAM in the 30-country European economic area, and the TNS market research service business in Ireland.
WPP has offered to sell the Irish business and to sell shares in its joint venture AGB Nielsen or the TAM services business of TNS.
Competition Commissioner Neelie Kroes said: 'I am satisfied that WPP's commitments will ensure that customers will not suffer as a result of this merger in terms of reduced choice or higher prices as regards both TV audience measurement throughout the EEA and market research in Ireland.'
All this, however, may still turn out to be academic as TNS has repeatedly urged its shareholders to reject WPP CEO Sir Martin Sorrell's offer after he refused to up his bid. Sorrell has extended his offer to this Friday, after receiving acceptances from just 11% of TNS shareholders by the previous deadline.
Based on the closing price of 486.5 pence per WPP share as at 23 September 2008, the offer announced by WPP on 9 July 2008 rates each TNS share at 264.9 pence, valuing the agency at approximately £1.161m.
In a regulatory response to today's news, the TNS Board again urged its shareholders to reject the offer, saying it undervalues the firm.
'The Board recommends that TNS shareholders take no action in response to the WPP offer and, in particular, that they do not complete any form of acceptance that they have received with WPP's offer document,' the Board stated.
Web sites: www.wpp.com and www.tnsglobal.com .
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