M&C Saatchi have confirmed a strong trading momentum, with headline profit before tax in line with management’s expectations of £31m for the full year.
The ad giant said in an update this morning: “This strong trading momentum and these forecasts evidence the future potential of the business and support the Board’s confidence in delivering on its standalone strategy and its ability to create material value for its shareholders”.
The update sits against the backdrop of ongoing takeover drama for the famous firm.
Just this week, the London-listed company urged shareholders to reject Vin Murria’s £254m bid for the company, as well as the alternative bid from fellow agency Next 15.
In a defence document, the M&C board reiterated previous claims that the investment vehicle’s bid “materially undervalues” the firm.
It added that the offer represents “both a low price and a high risk”, suggesting there could be a dilution of shares.
The company also said in a separate note that Next 15’s undervalued the firm because of the “deterioration of Next 15’s share price in current market conditions”.
The offer started at 247.2p per M&C share but has since dropped to around 195.5p a share.
Despite backtracking from the initial acceptance of Next 15’s approach earlier this month, M&C did state that the offer still remains superior to Murria’s offer, who, alongside her investment vehicle AdvancedAdvT, has a combined stake of 22 per cent in M&C.
The deadline to vote for AdvancedAdvT’s and Next 15’s bid is 13 and 17 August respectively.
M&C Saatchi’s shares have fallen around 25 per cent since the announcement that AdvancedAdvT was interested in the business back in January.
Peel Hunt gave the stock a Hold rating, with a target price of 247p,