M&C Saatchi shareholders have voted against the Next 15 acquisition proposal during a special session held on October 31.
The creative agency will not be sold to Next 15 following a 10-month takeover saga.
As we reported earlier in October, the takeover was unlikely.
It required 75% of shareholder votes to succeed, and all bosses and executives were already expressing opposition to the new deal.
One of the majority stakeholders, Vin Murria, and her investment wing AdvancedAdvT (ADV), have a combined stake in the firm of about 22.3%. Even before the vote, she publicly stated that neither she nor ADV will vote in favor of takeover.
As a remainder, Murria, a British tech entrepreneur, bid against Next 15 to gain the confidence of shareholders.
Now that Next 15 is out of the way, Murria’s stake in the company will prove troublesome, as she had already proposed a business model very much unlike what M&C Saatchi is doing at the moment.
Ultimately, 89% of the shareholders voted against the acquisition, sealing the deal on any takeover, as M&C Saatchi is no longer in the “offer period.”
M&C Saatchi, one of the largest independent agency groups in the world, will remain independent for the time being.
“The M&C Saatchi Directors believe in the strong, standalone future prospects of M&C Saatchi,” said the company directorate in a statement. “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, scale data and analytics capabilities and reduce costs.”
In a statement prior to the vote, Next 15 expressed concern regarding the outcome, stating the digital marketing group’s drop in share price.
Despite that, the company said that they need to maintain “pricing discipline” in all transactions.
“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.”
While both of the bids have failed, the cost of deflecting takeovers has put a serious dent in M&C Saatchi’s bottom line, costing the company $10.9 million in the first six months.