Wednesday, April 19, 2006

Blog postings from VNU shareholders’ meeting

Yesterday it was an important afternoon meeting for VNU in Amsterdam. There was a lot of commotion around the meeting as VNU is defending the public offer made by six private equity companies. First an AGM was scheduled, but this was postponed till 13 June, 2006. So the meeting was degraded to an information meeting on the offer of 28,75 euro per share. It was expected, that it would be a hot debate between the CEO Rob van den Bergh and the chairman of the supervisory board Aad Jacobs and dissident shareholders.

And a hot afternoon it was. During the meeting, I joined the Dutch language blog Frontrunner of Bert van Dijk, a journalist of Het Financieele Dagblad, the Dutch financial daily. Bert van Dijk reported from the floor. His blog started at 16:15h Dutch time in a factual fashion. It continued to report that there were 111 shareholders present, representing 33 per cent of the shares and making it a legal meeting.

The chairman Aad Jacobs started off the meeting explaining why shareholders should accept the offer of the private equity companies, united in Valcon. Initially there were 13 companies interested, but 6 companies eventually made an offer. Jacobs concluded, that this must be a good offer as 7 companies could not follow the financial offer of 28,75 euro per share. Between the lines of the blog you can read that the shareholders could think up other reasons why they left the pack. But Jacobs continued to say that the price was 30 times the netto profit or 13,5 times the ebita.

Vinke, partner in an opposing private equity company Vinke Asset Management, was given time to explain his opposition to the offer and illustrate how he would solve the crisis. Another player on behalf of the shareholders was Peter-Paul de Vries on behalf of the Dutch shareholders’ organisation VEB. Also private shareholders asked questions.

The emotions ran high with Peter-Paul de Vries indicating that the share price of VNU was twice as high in 200, when Van den Bergh took office. VNU’s CEO responded that were different times, besides VNU was the proud owner at that time of the ITT Yellow pages; Van den Bergh’s grand acquisition. (VNU bought the company for 1,9 billion euro and sold it after six years for a disappointing 2.08 billion euro. Not much of a value maker for the shareholder). Also the no-sale premium of 30 million euro is infuriating shareholders; if not 95 percent of the share are deposited in favour of this Valcon offer, VNU will have to pay this unusual penalty.

At 22:28h Bert van Dijk reports from the floor that the meeting has been closed after more than four hours. His conclusion is that VNU and the shareholders have haggled about the form and not so much about the offer. Shareholders will have to decide before 5 May, 2006, whether they will offer their shares.

As a journalistic exercise, it was interesting to follow the ten postings from the floor. It resembled the radio flashes of a soccer game; the program is interrupted for an update on the game, when there is a dangerous situation or as a team scores.

(As I remarked before in this blog, I have no shares in VNU, but I have worked for VNU during the period when Rob van den Bergh started his VNU career. The turn-around from a publishing company to an information company has been admirable, but the end game with IMS was too early. Now VNU is ripe for a break-up into publishing and exhibition divisions as well as data divisions).


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