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TMN Management Buyout Fails
In the UK, marketing services group TMN, the parent of research agencies iD Factor and ICD Research, has called off talks with private equity firm August Equity to fund a management buyout led by CEO Mark Smith and FD Craig Dixon.
The deal was first discussed in May, when August Equity made an indicative cash offer of 70p per share for TMN, following the breakdown in talks with rival firm Tangent Communications.
Today TMN issued a statement saying that, despite its performance being in line with management expectations, August Equity had been unable to generate the £52.8m third-party debt financing needed to fund the deal.
TMN Chairman Peter Harkness commented: 'While we understand that difficult debt market conditions have resulted in August Equity being unable to deliver an acceptable offer to the Board, we are united in our confidence in TMN's future as a listed company.'
Pretax profit for the full year to April 30 2008 will be within 10% to 15% of management expectations following a decline in demand at the group's e-mail marketing planning and buying agency. However, Smith said that the group has shown strong resilience, trading in line with management expectations, adding: 'We hold a cautious optimism with regards the remainder of the financial year.'
As of noon, TMN's share price had dropped 20% from yesterday's close to 30.1p.
Web site: www.tmnplc.com .
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