This might seem like rough justice for the French pretender, since it was only four years ago that the OFT told Decaux that advertising on "free" street furniture, the sub, sub sector of the outdoor advertising market the authorities have chosen to refer on, was not a distinct market sector. Still, time moves on and this type of outdoor advertising has grown and developed quite a bit since then. Certainly there has been enough concern expressed to justify public scrutiny.
The question now is whether it is worth shareholders hanging on for the higher price that might be forthcoming from Decaux should it eventually be cleared by the MMC. Decaux was last night sounding out big institutional shareholders on whether it was worth attempting to stay in the game. The answer seems to be that Decaux would have to commit to a considerably higher price to make it worth their while.
The time value of the money over the four months of the MMC inquiry is alone worth about 30p a share. Given the very narrow terms of reference, there is also a high chance of the MMC finding against Decaux, at which point the Americans would have More Group over a barrel. Obviously there is a price Decaux could promise that would make it worth taking the risk, but is Decaux really prepared to pay it?Reuse content