Latest Tokyo Brief coverage on DENTSU GROUP INC., tracking filings, financial news, and market signals from Japan.
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Dentsu Group has agreed not to tender its 61.76% founding stake in Dentsu Soken to VIC's planned November tender offer, backing a squeeze-out that would take the IT consultancy private with Itochu Corporation as the bidder's parent.
Dentsu Group has pledged not to tender its majority stake into VIC LLC's planned takeover of Dentsu Soken, teeing up a share-consolidation squeeze-out once the tender offer, targeted for early November, settles.
Itochu will buy out Dentsu Soken's minority shareholders and fold the IT consultancy into a joint venture with Dentsu Group, which keeps its 61.78% stake rather than selling.
An Itochu-controlled vehicle has offered ¥2,880 a share for Dentsu Soken, with parent Dentsu Group keeping its 61.78% stake instead of selling out, and the company plans to cancel its year-end dividend if the tender offer succeeds, matching the deal's pricing assumptions.
ITOCHU has offered ¥2,880 for every Dentsu Soken share not already held by parent Dentsu Group, and the IT consultancy's board is already recommending investors accept.
Dentsu Group swung to a ¥46.3bn first-half net profit largely because it sold a Ginza-area office building and avoided repeating last year's ¥86.6bn impairment, not because advertising demand recovered: organic gross-profit growth was just 0.3%, propped up entirely by a 5.0% gain in Japan against declines in the Americas, EMEA and APAC.
A possible take-private of Dentsu Soken is under consideration inside Dentsu Group's domestic strategy, but the company says the Nikkei report was not its announcement and no concrete decision has been made.