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Last Updated: Wednesday, 23 July, 2003, 11:35 GMT 12:35 UK
Cordiant backs WPP takeover
Heinz advertising
Cordiant advertises some of Britain's best-known brands
Shareholders in ailing British media firm Cordiant have voted in favour of an offer from arch-rival WPP, bringing a long-running takeover battle to a close.

Under the deal, WPP, which had already taken on Cordiant's 256m debt mountain, will pay about 10m ($16m) in shares for the firm.

The agreement comes despite fears that UK investment firm Active Value, which owns 28% of Cordiant's shares, would try to derail WPP's bid.

Last month, Active Value had proposed keeping Cordiant going as an independent company through a fresh cash injection.

But WPP, led by dealmaker Sir Martin Sorrell, had threatened to use its power as Cordiant's main creditor to tip the firm into administration if its shareholders had rejected its takeover bid.

Advertising casualty

In the event, investors holding over 99% of Cordiant's shares backed WPP's offer, well above the required 75% threshold.

WPP also saw off French advertising agency Publicis, which had expressed an interest in buying Cordiant before dropping out of the race last month.

Cordiant, whose assets include the illustrious Bates advertising agency, became a takeover target in April after it emerged that one of its few remaining major clients, drinks firm Allied Domecq, had taken its account elsewhere.

Domecq's defection followed a string of earlier client losses amid growing speculation about Cordiant's financial health.

The company, which helped promote M&M sweets with the famous slogan "M&Ms melt in your mouth, not in your hands," is the most high-profile casualty so far of the global slump in advertising spending.

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