Decaux makes plea to OFT in More bid battle

THE PRESIDENT of Decaux, the French outdoor advertising group, yesterday made last-ditch plea to the British competition authorities to clear his company's bid for More Group, its UK competitor.

In his first interview since Decaux launched its pounds 475m bid six weeks ago, Jean-Claude Decaux warned a decision to block the bid could allow US advertising giants to dominate the industry.

"The real issue is not whether we have three or four companies bidding for contracts but whether European companies can develop themselves," he said.

He added that the size of US advertising companies and the buoyant stock market multiples they attracted gave them a head start over European competitors.

"I have nothing against America," he said. "But we must ask whether US companies will have too strong a position."

He was speaking after Decaux flew a party of journalists, including The Independent, to its headquarters outside Paris.

Mr Decaux's comments came as Clear Channel Communications, the US group whose pounds 425m offer for More was trumped by Decaux, was forced to issue an embarrassing correction.

The company has written to 500 local authorities in the UK, correcting an earlier letter which suggested that French competition authorities had fined Decaux Fr1m in the 1980s for abusing its monopoly position. In fact, the fine was never imposed.

The Office of Fair Trading is today expected to pass its recommendation on Decaux's bid to the Trade and Industry Secretary, Margaret Beckett, who is likely to announce her decision next week.

Decaux's bid will lapse if it is referred to the Monopolies and Mergers Commission, leaving the way open for Clear Channel to complete the takeover.

At issue is a lucrative section of the $500m (pounds 300m) UK outdoor advertising market. Decaux and More are both experts in the supply of street furniture - bus shelters, public toilets and waste paper baskets - which the companies offer free of charge to local authorities in return for being allowed to sell advertising space on them.

A successful bid would give Decaux a near monopoly of the UK street furniture market. The company, which invented the concept when Mr Decaux set up the business in 1962, already has close to 80 per cent of the market in France.

Decaux and Clear Channel have both lobbied the OFT extensively. Clear Channel has tried especially hard to encourage Britain's local authorities, who award street furniture contracts, to make representations to the OFT.

Mr Decaux strongly defended his company's strong position in France - currently the subject of another investigation by the French authorities - arguing that economies of scale in the design and manufacture of street furniture allowed the company to offer a better service to smaller towns.

Decaux has promised similar benefits to UK local authorities if its bid succeeds. It has pledged to spend pounds 50m upgrading existing billboards and bus shelters, while offering bus passengers in London free pagers which will tell them when their bus is due.

Mr Decaux yesterday admitted to being annoyed by the opposition to the bid. Roger Parry, More chief executive, while officially adopting a neutral position, has made no secret of his belief that the companies are incompatible.

Industry observers believe Decaux is terrified at the prospect of More, backed by Clear Channel's $2bn cash pile, taking on the French company on its home turf.