M&A battle for M&C Saatchi is over after shareholders reject Next 15 bid

M&C Saatchi shareholders have voted overwhelmingly against Next 15’s takeover offer – a decision that marks the end of an M&A saga, which has lasted since January.

More than 89% of investors opposed the sale to Next 15 and only 11% were in favour, largely because M&C Saatchi's board was unable to recommend the deal.

Next 15 originally made its offer in May but the implied value has tumbled since then as its share price has declined, largely on wider economic worries.

Vin Murria, the top shareholder in M&C Saatchi, and her business, Advanced AdvT, who together hold 22.3% of M&C Saatchi share capital, were among those that voted against the Next 15 offer.

Murria and Advanced AdvT had previously sought to buy M&C Saatchi but dropped out of the race in early October after failing to win over the board.

Next 15's offer has now lapsed, following its rejection by M&C Saatchi's shareholders, and M&C Saatchi said it is no longer in an offer period.

M&C Saatchi chief executive Moray MacLennan has previously described the takeover saga as a “distraction”, saying the business wants to remain independent.

The company said in a statement: “The M&C Saatchi directors believe in the strong, standalone future prospects of M&C Saatchi.

"Following the lapse of both the Next 15 offer and the ADV offer, the M&C Saatchi directors look forward to continuing the implementation of M&C Saatchi’s strategy as an independent business including to: invest in high margin businesses, enhance margins, further simplify the group, implement technology platforms, and scale data and analytics capabilities, and reduce costs.”
 
In response, Next 15 said in a statement that the outcome of the vote had been expected after Murria and Advanced AdvT previously said they intended to vote against the deal.

Next 15 said: “Next 15 will always maintain pricing discipline when pursuing its M&A strategy, which may result in certain transactions not proceeding. The board remains highly confident in the Next 15 Group's future prospects.

“As noted in the Next 15 Group's Interim Results on 26 September 2022, strong trading in H1 has continued into the third quarter of our financial year, with results for the full financial year expected to be at least in line with management expectations. The scale and strength of our US business, combined with recently announced new client wins, give us confidence for further growth in the next financial year.”
 
Following the news of the vote, analysts at Peel Hunt said they welcomed a conclusion after the 10-month long offer period.

They added: “Given the result, we believe both M&C Saatchi and Next 15 now need to focus on their individual standalone strategies to weather the storm ahead. We look forward to hearing on trading from both in the New Year.”