Cordiant shares fall as WPP nears victory

Cordiant shares fell 29 per cent yesterday as the stock market sensed that WPP's £266m offer for the stricken advertising group was likely to go through.

Cordiant shares closed at 2.4p, fractionally below the 2.56p value placed on them by the WPP all-share offer.

Though Cordiant shares are due to be delisted today it is thought that 29 per cent shareholder Active Value has still not given up hope of finding an alternative proposal that would deliver more value to shareholders. It is thought to be continuing work on other options ahead of a meeting of Cordiant shareholders next Wednesday to vote on the deal.

Active Value has sufficient shares to block the WPP offer but will need to provide an alternative to avoid Cordiant being pushed into administration by WPP which has acquired all of Cordiant's £256m debts. If Active Value fails it will be nursing substantial losses on its shares, some of which were acquired at over 70p per share. Nadeh Ojjeh, who has amassed a 10.1 per cent holding, will also be nursing losses of around £400,000 having bought Cordiant shares above the level of the WPP offer.

However, trades have been continuing above the offer price. Aviva yesterday disclosed the sale of a block of 3m Cordiant shares for 3.16p though no buyer was revealed.

It was thought that Active Value might try to engineer a change of control at Cordiant ahead of today's deadline to delist Cordiant's shares. This could have enabled Publicis to buy the remaining 25 per cent in Zenith Optimedia it does not already own. However, Publicis has distanced itself from any planned takeover.