Chime spends £44m on buying JMI amid a dispute with Sir Martin Sorrell's WPP
Saturday 26 October 2013
Chime Communications yesterday spent up to £43.7m on JMI, a US sports-marketing firm which specialises in motor racing.
However, the deal was overshadowed by a row with its top shareholder WPP, which plans to sell its stake in Chime. The dispute pits ex-Olympics supremo Lord Coe, the chairman of Chime's sports-marketing division, against WPP's boss Sir Martin Sorrell.
WPP did not oppose the acquisition of JMI, in which WPP also had a minority stake, but Sir Martin's camp wanted to increase its 21 per cent shareholding in Chime. WPP asked for 29.9 per cent and, when that offer was rebuffed, 27.5 per cent. Chime's board offered a compromise of 24.9 per cent but the two sides did not agree. It is understood the Chime camp wanted all its shareholders to have a fair chance to participate in a fundraising for the acquisition.
Chime raised £25.6m in a placing at 300p a share before yesterday's stock-market opening. WPP did not participate, so its stake has fallen to 18 per cent. It plans to "explore" a sale of its shares, worth an estimated £58m, "subject to price".
Chime shares tumbled 6.25p to 316.75p, although they remain close to a record high.
Numis Securities and HSBC advised on Chime's placing.
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