Dutch publisher and market research giant VNU NV on Wednesday said it agreed to be acquired by a group of six private equity firms including Blackstone Group and Carlyle Group for about $8.94 billion in cash, or nearly $34.26 per share, but two shareholders have rejected the offer and are holding out for a higher price.
The offer represents a 23 percent premium over the closing price on July 8, 2005, the last trading day prior to VNU’s announcement of its planned merger with IMS Health. Netherlands-based VNU, the owner of the U.S. Nielsen television ratings and the publisher of the Hollywood Reporter and Billboard magazine, became a takeover target after investors forced the company to abandon a nearly $8 billion acquisition of IMS Health last year.
Including debt, the transaction is worth 8.6 billion euros ($10.25 billion).
The consortium of bidders which includes AlpInvest Partners, Blackstone Group, Carlyle Group, Hellman & Friedman, Kohlberg Kravis Roberts & Co. and Thomas H. Lee Partners has been poring over VNU’s financial and operating data since late February before making the final offer.
The consortium said it would keep “VNU substantially together as an integrated company” a sticking point for two of VNU’s major shareholders.
After the deal was announced, shareholders Fidelity International and Knight Vinke Asset Management LLC reacted, saying they likely won’t back the bid. The two companies led a shareholder revolt against VNU’s acquisition last year. New York-based equity management firm Knight Vinke, which owns 2 percent of VNU, said in a statement Wednesday that the deal “substantially undervalues the company” and that a higher value could be obtained by breaking up the company and selling off VNU’s “main constituent parts.” Fidelity, which controls 15 percent of VNU, told Bloomberg News that it is unlikely to support the offer.
Upon the closing of the offer, Rob van den Bergh, chief executive of VNU, will step down from his post. VNU expects the public offer for its shares to commence in early to mid-April and to hold a shareholders meeting to discuss the offer in mid- to late April. The transaction is expected to close by the end of May, VNU said.
In mid-January, VNU confirmed that it had received a buyout offer worth up to $8.87 billion from a group of private equity firms. The bid was for between $34 and $34.60 per share. In a statement on Feb. 7, the company said it would take a few more weeks to decide on the tentative offer.
On Tuesday, the company’s supervisory board unanimously supported the transaction, saying it was in the best interests of VNU’s stakeholders.
“Based on a long and careful analysis of various alternatives, including remaining a stand-alone company and breaking up the company, we concluded that this transaction best serves the interests of VNU’s shareholders, clients and employees,” said Aad Jacobs, chairman of VNU’s supervisory board, in a statement Wednesday.
