More Group's share price surged almost 10 per cent after New Decaux, a subsidiary of Decaux SA, announced it had "approached More Group to inform it that New Decaux is considering making an offer". More Group made headlines earlier this month when it agreed to a cash bid from Clear Channel, the US media giant, that sent share prices up 23 per cent.
Clear Channel's offer was a 25 per cent premium on More's previous share price. At the time, industry analysts called the bid a "full and fair." Roger Parry, More's chief executive, said that should an offer better than Clear Channel's be put on the table, it would be considered. "Our job is to maximise shareholder value. Our shareholders would have never forgiven us if we would have turned Clear Channel down." At the time of the deal, Mr Parry was quoted as saying the deal was at a "huge premium. We just couldn't say no."
Yesterday he said had yet to be contacted by Decaux. "I'm a bit mystified by the whole thing. I've literally not had a phone call." Analysts said any offer by Decaux for More would run into immediate regulatory difficulties. "Any deal probably won't wash with regulators when you look at Decaux's family tree," Lorna Tilbian, analyst with Panmure Gordon, said. "There is very likely going to be some sort of regulatory handle there, which is exactly why I'm wondering why they've made the offer at all."
Decaux SA is 20 per cent owned by Compagnie des Eaux, the conglomerate which this month moved to take over Havas, the world's fifth-largest media group. Havas owns Mills & Allen Holdings, one of Britain's largest outdoor advertising companies. "We'd be looking at a French-style cartel," Ms Tilbian said.
Charles Cook, a Decaux spokesman, said contact had been made to More's financial representatives and that if an official bid were made, it was prepared to offer the group a "meaningful premium of not less than 5 per cent" over Clear Channel's offer: "This is a serious offer which has been made with real intent."
Decaux, which like More specialises in placing advertising on bus shelters, operates in 19 countries and employees approximately 4,000 people.
More, which operates in 22 countries, has almost 1,000 employees.
Clear Channel, which owns radio and television stations throughout the US, made the offer for More as part of an effort to enter the international advertising market, following acquisitions in US radio, television and outdoor advertising. Yesterday More issued a statement to stockholders to take no action. More's share price rose 93.5p to 1122.5p