Operating profits were down 9 per cent to pounds 30.3m in the six months to 30 June, on turnover of pounds 1.39bn, up 42 per cent, but Aegis incurred exceptional costs of pounds 14m, which included the cost of relocating its head office to Paris. The company estimates it will save about pounds 15m a year by moving.
The shares, which yesterday fell 6p to 41p, stood at 110p in July before Peter Scott, the chairman and chief executive, announced his resignation because he was unwilling to relocate to Paris. He is expected to receive a pounds 2.5m pay-off.
The company has also rescheduled its deferred payments on Carat Group, Europe's biggest media buying unit, which Aegis bought in 1988. The cash owed by Aegis to the original owners of Carat has been reduced to pounds 25m from pounds 37.5m. Their stake in Aegis, however, leaps from 26 to 44 per cent with the proposed issue of 34.1 million new ordinary shares at 55p per share.
Neil Blackley, media analyst at James Capel, said he would urge shareholders to vote against increasing the holding of the Carat vendors so substantially. He said there had been rumours on the French markets of a possible bid for Aegis and the proposals would make it in effect bid-proof.
The rights issue, underwritten by Warburg Pincus, Aegis's other main shareholder, will raise pounds 19.75m through the sale of convertible unsecured loan stock.
A US federal judge turned down an application by Aegis Group to dismiss a dollars 300m suit which alleged its sports marketing unit defrauded USA Soccer Properties (USASP) and C&W Associates. The suit alleged that C&W's 45 per cent stake in USASP was transferred without its consent to a new partnership controlled by Aegis's Pascoe Nally International unit.Reuse content