Offer by WPP for TNS

9 Jul 2008

OFFER
by
WPP GROUP PLC
for
TAYLOR NELSON SOFRES PLC

SUMMARY
• The board of WPP announces the terms of an offer to acquire the whole of the issued and to be issued share capital of TNS.

• WPP will offer 173 pence in cash and 0.1889 of a New WPP Share for each TNS Share. Based on the Closing Price of 464 pence per WPP Share on 8 July 2008, the WPP Offer values each TNS Share at 260.6 pence and values the entire issued share capital of TNS at approximately £1,082 million.

• The WPP Offer represents a premium of:

• 52 per cent. over the Closing Price of 171 pence per TNS Share on 28 April 2008, being the day prior to the announcement by TNS of a potential merger with GfK; and

• 21 per cent. over the Closing Price of 215 pence per TNS Share on 2 May 2008, being the last business day prior to the announcement by TNS that it had received a proposal from WPP,
in each case based on the Closing Price of 464 pence per WPP Share on 8 July 2008.

• The WPP Offer will also include a Mix and Match Facility under which TNS share owners will be able to elect to vary the proportions in which they receive cash and New WPP Shares, subject to offsetting elections being made by other TNS share owners.

• A Kantar/TNS combination would create the second largest information, insight and consultancy group globally, with leadership positions in key geographies, competencies and sectors. WPP believes that the Enlarged Group would be able to lead the industry in terms of the quality of market insight and the way it is delivered to and used by clients:

• Kantar/TNS would be a leading participant in the largest developed and faster growing markets around the world. WPP believes the Enlarged Group would hold the #1 or #2 position in eight of the top ten markets by revenue (with #3 in Japan and #4 in Italy) and in nine out of ten selected faster growing markets by revenue (with #4 in Brazil);

• the Enlarged Group would be one of the leading participants in a number of growing, highly attractive competency areas and sectors, including Retail & Shopper, Media evaluation (with the exception of the US), Digital evaluation, measurement and understanding, Communications, Innovation, FMCG and Healthcare;

• the Enlarged Group would hold strong positions in the Financial Services, Technology and Automotive sectors; and

• WPP believes that Kantar/TNS would be the pre-eminent provider of online data collection, where the two organisations individually run two leading online panels.

• WPP believes that the combination of Kantar and TNS would generate industry-leading margins. Margin improvement would be realised principally through the consolidation of internet panels, elimination of duplicative public company costs, procurement savings, IT infrastructure and other organisational and operational efficiencies achievable over a larger information, insight and consultancy research revenue base.

• WPP expects these improvements to deliver cost synergies of at least £52 million per annum before tax by 2011*, in addition to incremental revenue opportunities.

• The total one-off implementation cash costs related to achieving these cost synergies, which would be incurred in the first two years following completion, are expected not to exceed £52 million.

• WPP also expects that, if the WPP Offer is completed, the transaction would deliver a return on capital (post-synergies) in excess of its weighted average cost of capital in the second full year following completion, be earnings neutral (post synergies) in the second full year following completion, and earnings enhancing (post synergies) in the third full year following completion after deducting the costs of achieving the synergies.*

• WPP believes that the combination of TNS and Kantar would provide opportunities for the clients and people of TNS which are significantly more attractive than those offered by the ‘nil-premium’ Proposed GfK-TNS Merger.

• WPP questions the ability of GfK-TNS to deliver the merger benefits expected by TNS as set out in the TNS Circular, based upon the quantum of synergies, the structure of the proposed merger and TNS’s track record of integration.

• WPP notes that the dominant shareholder of GfK-TNS will be GfK-Verein, a non-profit organisation that does not have the objective of maximising shareholder value, and that the GfK-TNS board will consist of six non-independent GfK appointees, in addition to a GfK appointed chairman who will have a casting vote.

• WPP also notes that TNS share owners will not receive an offer for their shares from GfK-Verein let alone a premium to recognise a change of control. WPP also believes that the size of GfK-Verein’s shareholding in GfK-TNS would act as a potential barrier to any future takeover offer for GfK-TNS.

• WPP believes that the WPP Offer provides superior value and greater certainty to TNS share owners compared to the ‘nil-premium’ Proposed GfK-TNS Merger.

THE WPP OFFER IS CONDITIONAL, INTER ALIA, ON TNS SHARE OWNERS NOT APPROVING THE ‘NIL-PREMIUM’ PROPOSED GFK-TNS MERGER AT THE TNS GENERAL MEETING CURRENTLY CONVENED FOR 18 JULY 2008.
WPP STRONGLY ENCOURAGES TNS SHARE OWNERS TO:
(1) VOTE AGAINST THE RESOLUTIONS REQUIRED TO APPROVE THE PROPOSED GFK-TNS MERGER AT THE TNS GENERAL MEETING; AND
(2) ACCEPT THE WPP OFFER.

Commenting on the WPP Offer, Sir Martin Sorrell, Chief Executive of WPP, said:
“This morning, we have confirmed our offer, which values TNS at 260.6 pence per share, based on yesterday’s closing price for a WPP share. We believe that the offer for TNS generates value for WPP share owners and offers TNS share owners both cash certainty and equity upside. Reluctantly, we have waived our earlier pre-condition for the board of TNS to recommend our offer. Despite repeated efforts over more than three months to engage with TNS management, we have been unable to enter into any discussions that could lead to an agreement. Although our offer may be characterised by some as a ‘hostile bid’, we believe that it is in no way hostile to TNS share owners nor to TNS’s clients and people. In fact, WPP believes it is more committed to maintaining the TNS brand than GfK. The offer from WPP is a superior alternative to what is, in effect, a ‘nil-premium’ reverse takeover of TNS by GfK and a ‘merger of unequals’. We remain willing, at the shortest of notice, to meet with the board of TNS.”

This summary should be read in conjunction with the full text of the following announcement.
Enquiries

WPP
Feona McEwan +44 20 7408 2204
Kevin McCormack +1 212 632 2200

BUCHANAN COMMUNICATIONS
+44 20 7466 5000
Richard Oldworth

MERRILL LYNCH +44 20 7628 1000
Richard Taylor
Mark Astaire (Corporate Broking)

PERELLA WEINBERG +44 20 7268 2800
Philip Yates
Graham Davidson

GOLDMAN SACHS
James Del Favero +1 212 902 1000
Simon Dingemans +44 20 7774 1000