True North points to Cordiant bid

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The Independent Online

True North Communications, the giant US marketing services group, is poised to make a £1.1bn bid for Cordiant, the advertising and public relations firm, writes Jason Nissé.

True North Communications, the giant US marketing services group, is poised to make a £1.1bn bid for Cordiant, the advertising and public relations firm, writes Jason Nissé.

Senior advertising sources say that David Bell, the chief executive of True North, recently met with his opposite number at Cordiant, Michael Bungey, to discuss an offer.

True North is understood to have been eyeing Cordiant for some time, but it has been spurred into action after losing out in the battle to take control of Lighthouse Global Networks, which owns the London-based financial PR firm, Financial Dynamics, and the design group, Fitch.

Insiders say that Cordiant's share price could come under pressure as some of the US financial group that backed Lighthouse try and recoup their investment be selling Cordiant shares.

Cordiant split from its sister company, Saatchi & Saatchi, two years ago. Both have since seen their values soar. Earlier this year Saatchi succumbed to a £1bn bid from Publicis, the French marketing group.

Cordiant has long been seen as an attractive acquisition. Its main business is the Bates advertising network but it has built up a portfolio of operations in areas such as direct marketing, events management and public relations.

The marketing services world has been awash with bid activity in recent months, the largest deal being Sir Martin Sorrell's WPP Group's £3bn purchase of Young & Rubicam, one of Madison Avenue's most prestigious firms.

That deal is expected to be approved by shareholders towards the end of next month. WPP will publish its half-year results tomorrow, which are expected to show pre-tax profits of around £138m, ahead of market expectations.

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