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Aegis Group Agrees to 3.16 Billion Pounds Takeover

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Independent media communications firm Aegis Group plc (LSE:AGS) agreed to a takeover bid by Dentsu Inc., Japan’s top advertising company, in a deal that will “create a new global communications network for the digital age”, the London-listed FTSE 250 member said today.

The British firm disclosed it received an offer of 240 pence a share, adding nearly half of Aegis’ current market value to about £3.164 billion.

Shares of Aegis followed suit, reaching 235.6 pence on the London Stock Exchange, with a turnover of over 100 million shares by 1:00 PM GMT.

“The boards of both companies believe the combination of Dentsu and Aegis will ensure continuity for both businesses and provide a strong platform for future growth,” Aegis Group stated.

Compelling Combination

Jerry Buhlmann, Chief Executive Officer of Aegis, said the merger of both companies will be a “compelling combination of two great businesses that will create one of the world’s most dynamic marketing services groups – and the first to be born in the digital age.”

Dentsu, which dominates the Japanese advertising sector – accounting for 10.1% of the global market, derives 86% of its business locally; hence, acquiring Aegis means the company will have access to the European ad market, where Aegis derives more than half its revenue in 2011.

Aegis, on the other hand, will be, together with Dentsu “the market leader in the Asia-Pacific region, enjoying a strong presence across Europe and the fastest growing agency network in the US.”

“We at Aegis are delighted at the prospect of being able to play a full part in helping Dentsu create a platform for global growth and continued digital innovation. By forming the first communications group with true global reach, the growth strategies of both businesses will be enhanced as we provide more scale, geography, capability and investment to support clients.”

All Set

Dentsu said it has already secured irrevocable undertakings for 30.5% of all the issued shares of Aegis, 15% of which was acquired from the party of Vincent Bolloré, the largest shareholder of Aegis controlling 26.4%, for €535 million.

A further 5% will be disposed by the group within two months with the remaining 6.4% controlled by the group to be tendered, resulting in a total disposal value of Bolloré’s stake at €915 million.

The directors of Aegis Group have also committed an aggregate of 4.1% of their combined shareholdings and will unanimously recommend the transaction with the rest of the media group’s shareholders.

Both companies expect the deal will be completed in the fourth quarter of 2012.

Company Spotlight

Aegis Group is a focused media and digital communications group operating in 80 countries across five continents and employing over 12,000 employees.

Established in the UK, the company has been trading on the London Stock Exchange since 1984, and forms part of the FTSE 250 Index.

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