Key facts
- Activist investor Harwood Capital now owns more than 8% of M&C Saatchi.
- Harwood Capital is pushing for the sale of M&C Saatchi's various divisions.
- M&C Saatchi's shares have declined over 25% in the past year.
- The advertising group has faced internal challenges, including a change in leadership.
- Major shareholder Vin Murria had previously attempted a hostile takeover.
Activist investor Harwood Capital has increased its stake in the advertising firm M&C Saatchi to over 8%, intensifying pressure for the company to sell off its constituent parts. This move signals a potential break-up of the well-known British advertising group, which was founded in 1995 by Maurice and Charles Saatchi.
Harwood Capital began building its position in M&C Saatchi in 2020 and has steadily increased its holding, now aiming to unlock shareholder value through a piecemeal sale of the company's diverse divisions, which span lobbying, events management, traditional advertising, and sports marketing.
The activist's offensive comes as M&C Saatchi faces significant headwinds. Its shares have fallen by more than a quarter in the last 12 months, partly due to a broader sell-off in advertising groups linked to artificial intelligence concerns. The company's growth in the Middle East, particularly its sport and entertainment division, is also threatened by the Iran war, while the UK market shows signs of softening.
Internally, M&C Saatchi has experienced turbulence, including the departure of its former boss Zaid Al-Qassab after less than two years. Major shareholder Vin Murria, who previously led a £254 million hostile takeover bid, has taken a board seat. A break-up would likely mark the end of M&C Saatchi's long tenure on London's Aim stock exchange.