Aegis pounds 20m rights issue gets only 14% take-up

A CONVERTIBLE rights issue by Aegis Group, the advertising agency, to raise pounds 20m as part of a refinancing package has flopped, with just 14.4 per cent taken up by its shareholders, writes Neil Thapar.

The cash call, involving the issue of 22.5 million units at 100p, has been fully underwritten by Warburg Pincus, the US investment firm, which already owns 14 per cent. The flopped issue means it will end up with about a third of the group's voting shares.

Another 30 per cent will be held by Gilbert Gross, the founder of Carat, the group's main trading subsidiary, and 6 per cent by Eurocom, the French advertising group, and the balance by its other shareholders. The failed rights comes amid continuing uncertainty about Aegis's prospects. In July, Peter Scott was ousted as chairman and chief executive after a boardroom coup. He has been paid pounds 2.2m compensation.

Meanwhile, the French parliament and monopolies watchdog are carrying out separate inquiries into the country's media-buying market, where Aegis holds the leading position.

The shares have collapsed from a peak of 215p last October to 16p yesterday. Earlier this week, the company announced that it was withdrawing its share listing in Paris and New York.