LONDON, UK: The Board of AdvancedAdvT Limited has confirmed its intention to exploring a share exchange merger with M&C Saatchi.
This follows the announcement made by AdvancedAdvT on 5 January 2022 confirming that the company had acquired 12 ordinary shares in M&C Saatchi, an international communications network headquartered in London.
AdvancedAdvT Limited is an acquisition vehicle listed on the standard segment of the London Stock Exchange. The Company is led by Chairman Vin Murria OBE, who previously founded and was CEO of Advanced Computer Software Group plc.
The Board believes the enlarged group would have the opportunity to create significant value for its then shareholders. A merger would create an opportunity to build a data, analytics and digitally focussed creative marketing business with a strong balance sheet and additional management expertise in transforming businesses at pace and execute on complementary M&A.
This would allow the enlarged group to continue its evolution and, crucially, accelerate the implementation of its growth strategy and therefore be increasingly relevant to its customers.
The Board believes the enlarged group would be well-positioned to take advantage of the structural changes arising from an acceleration of digitalisation, affecting the way businesses operate, engage and sell to customers, and would offer benefits to employees, customers and shareholders.
The merger, combined with a focus on a data, analytics and digital creative marketing strategy plus M&A, would enable the enlarged group to capitalise on the heightened opportunity to ‘navigate, create and lead meaningful change’ whilst guiding companies on their new digital journey.
It would defend M&C’s traditional creative base against disruptive competitors and enable the enlarged group to grow market share against its peers.
The merger would also enable M&C to resolve the legacy put option issue as well as providing the cash to accelerate investment in the business and transformational digital led M&A.
The Company brings additional management skills with considerable expertise and experience to complement, accelerate and grow the enlarged group through strategic and bolt-on acquisitions in fragmented international markets. The Company’s management has proven previous success in identifying, realising and harnessing latent value within businesses.
The combination of the M&C brand and platform with the Company’s funding and experience is expected to increase the M&A opportunity pipeline. The combined reach and renewed appeal of the platform could attract many more quality assets.
The outperformance and valuation of data-led digital marketing agencies and consultancy peers demonstrates investor support for companies who successfully capitalise on the perceived market opportunity.
Other digital marketing groups have been successful in using M&A to acquire digital capability.
We see a significant opportunity for the enlarged group, with an accelerated data, analytics and digital strategy and combined stewardship, to achieve similar valuation multiples, improve the liquidity of the shares, implement a progressive re-instatement of the dividend policy which we believe will enhance the business’ attractiveness to investors.
Vin Murria OBE, Chairman of the Company and a non-executive director of M&C, owns 15,237,985 ordinary shares in M&C, representing 12.46% and 17,500,000 ordinary shares in the Company, representing 13.26%.
The Company owns 12,000,000 ordinary shares in M&C, representing c.9.82%.There can be no certainty that any formal offer for M&C will be forthcoming, nor as to the terms of any such formal offer.