TORONTO (Reuters) – Cossette Inc (KOS.TO), Canada’s largest homegrown advertising agency, said on Tuesday it will sell itself to private eqyity firm Mill Road Capital, spurning a lower bid from Cosmos Capital.
Mill Road will acquire all of Cossette’s issued and outstanding subordinate voting shares for C$7.87 a share in cash.
Based on about 12.4 million shares outstanding, the deal is likely to be worth about C$97.6 million ($92.2 million). The Mill Road offer is not conditional on financing or due diligence.
Last month, Cossette urged shareholders not to tender shares toward a sweetened bid from North American private equity group Cosmos Capital worth C$5.25 a share, or about C$88 million. [ID:nN29102296]
The advertising agency’s clients include McDonald’s Restaurants of Canada, Bell Canada, General Motors of Canada and Coca-Cola.
Cossette’s board unanimously approved the Mill Road offer and has agreed not to actively solicit competing acquisition proposals. However, the board retains the ability to consider any competing acquisition proposal. ($1= $1.058 Canadian) (Reporting by Euan Rocha; Editing by Derek Caney)